Medicare Advantage (MA) plans can vary by availability, benefits, and costs based on location and the insurance company that is offering the plan. These plans can also change each year, which means that beneficiaries can expect changes for 2014 Medicare Advantage plans.
Forecasts project that the total number of available 2014 Medicare Advantage plans will fall by about 5% when compared to 2013 options. According to a recent analysis of Centers for Medicare & Medicaid Services (CMS) data conducted by Avalere, the total number of MA plans will decline from 2,664 offerings in 2013 to 2,522 plan options in 2014.
2014 Medicare Advantage changes to specific plan types
Most of the 2014 Medicare Advantage changes will affect Preferred Provider Organizations (PPO) plans, Private Fee-for-Service (PFFS) plans, and Special Needs (SNF) plans. The most popular type of MA plan, Health Maintenance Organizations (HMO) plans are going to see an increase in offerings. Throughout the country, the Midwest and South will see the highest amount of Medicare Advantage reductions, with 80% of these counties slated to see a decrease in options. Half of the counties throughout the Northeast and the West will also have fewer options to choose from.
This reduction in overall Medicare Advantage plan availability comes as a result of the implementation of the Affordable Care Act (ACA, also known as Obamacare). According to Avalere, some of the cited factors include payment cuts to the aforementioned plans, alterations to the CMS risk adjustment strategy, and the application of the new health insurer fee.
These factors have forced health insurance companies to reconsider their strategies for 2014 Medicare Advantage plans. As such, companies are favoring HMOs as the most viable of plan types, meaning their availability in the market will increase by 2.6% from 1,675 plans in 2013 to 1,718 HMOs in 2014. On the other hand, PPOs will decline by 16.6% in 2014, going from 709 offered plans down to 591 plans. The same is true for SNPs, falling 13% from 625 plans to 544 in 2014. PFFS plans will be also drop, although they represent a small amount of the market, having just 4% of Medicare Advantage beneficiaries enrolled in them (according to 2012 data).
Other Medicare Advantage plans changes in 2014
There is no guarantee that once you join a Medicare Advantage plan that the details (costs and/or coverage) will stay the same each year. It is recommended that beneficiaries familiarize themselves with all the potentially shifting factors in order to properly determine which plan is right for them.
There is always the issue of cost. Some Medicare Advantage plans may offer monthly premiums as low as $0, while others will charge a higher amount. The average premium amount for Medicare Advantage was about $32.60 in 2013. This average, as well as other MA-related out-of-pocket costs (like deductibles, copayments, and/or coinsurances) may increase or decrease in amount for 2014 Medicare Advantage plans.
Much like the cost, plan benefits can change. Every Medicare Advantage plan must offer at least the same amount of coverage that is provided by Original Medicare (Part A and Part B), with the exception of hospice care, but can offer additional benefits such as vision, hearing, and/or dental coverage. It is always important to review your plan’s annual summary of changes to ensure that your needs will still be covered in the forthcoming year.
Finally, requirements may also change. Some Medicare Advantage plans require that beneficiaries only use health care providers in a certain network, while others may require that beneficiaries choose a primary care physician. These restrictions may change from year-to-year just like cost and benefits for 2014 Medicare Advantage plans.