Medicare Advantage in 2012 – Marching Ahead Stronger Than Ever

Affordable Care Act that had once been touted as Medicare Advantage nemesis has strengthened the Medicare Advantage plans instead. Now senior U.S. citizens have more choices available in Medicare Advantage plans that offer better quality of care at reduced premium rates.

Earlier this month, the Centers for Medicare & Medicaid Services announced that the average premium rates for Medicare Advantage premiums have fallen by 7%. Not only that, the enrollment in Medicare Advantage plans witnessed an increase of around 10% over the past one year.

The fall in premium rates and increase in enrollment figures are in line with the September 2011 projection figures. Over the past year, average premium rates have fallen to $31.54, from the last year value of $33.97. As of February 2012, there are 12.8 million Medicare Advantage enrollees as compared to 11.7 million in 2011.

While the Medicare Advantage plans remain robust as far as the high enrollment and low premium rates are concerned, the Medicare Advantage has also shown positive growth in the number of plan choices available and increased accessibility to MA services. Here are a few statistical points:

• All the U.S. states now have an average of at least 26 Medicare Advantage plans to choose from
• Accessibility to Medicare Advantage plans has increased with 99.7% of seniors enjoying easy access to Medicare plans
• Since the year 2010, when the Affordable Care Act came into existence, the enrollment in Medicare Advantage plans has increased by 17% and the premium rates have fallen by as much as 16%
• There have been increased enrollments in Medicare plans with 4 star and 5 star ratings as compared to previous years.

The ACA regulations mandate the health plans offering Medicare Advantage, to invest 85% of collected payments on administrating quality medical care. The MA plans are also advised against charging premiums higher than what a senior citizen traditionally pays for MA plans. The preventive services will also be administered free of cost.

To encourage quality services, in 2012, the Medicare Advantage plans will be encouraged achieve high quality score ratings through bonus payments. Plans which achieve 5 star ratings and provide high quality care at lowered costs will be granted exclusive rights to market and enroll beneficiaries round the year instead of just during the open enrollment period.

The star ratings have been introduced to help seniors gauge which MA plans in their areas are offering high return on investments and are taking relatively better care of seniors. A new, value-based purchasing system has also been introduced that pays plans with excellent health care more than the plans which provides low quality of health care.

Most healthcare plans enjoyed high profits and improved bottom lines after the last Medicare enrollment cycle that lasted for seven weeks, from October 15, 2011 to December 7, 2011.

It is further testament to the fact that the Affordable Care Act has not only managed to improve the quality of health plans available to seniors, but has also aided in ensuring higher enrollments and improved profits for health plans.

Author is a well known authority on health insurance in the US. He is currently looking to expand his expertise in Medicare Advantage Sales and Insurance quoting software available.