(Bloomberg) — Health insurers participating in the Medicare Advantage program may face a government payment cut of about 3.55 percent in 2015.
The payment reductions that the Centers for Medicare & Medicaid Services (CMS) proposed today are subject to negotiations with the industry.
CMS hopes to complete work on 2015 plan payment guidelines April 1.
Insurers had expected cuts of as much as 6.5 percent and had mounted a lobbying campaign to reduce the amount even before CMS released today’s filing.
On Feb. 14, 40 senators sent the Obama administration a letter asking officials to freeze program support at the current level.
About 16 million people, or 30 percent of all Medicare enrollees, are in Medicare Advantage plans this year, according to February data from CMS.
The Medicare Advantage program gives private insurers a chance to offer Medicare enrollees an alternative to the traditional government-run Medicare program.
The government created an earlier version of the program, Medicare + Choice, then slashed funding and let enrollment shrink before developing the current version.
Because of the new cuts, CMS actuaries are estimating that, in 2015, enrollment may decline for the first time since 2004.