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PFM hosts briefing on policy changes to Medicare Advantage


The Medicare Advantage (MA) program has received a lot of attention over the past six weeks. Every year between late February and early April, the Centers for Medicare and Medicaid Services (CMS) release a preliminary and final notice of MA payment rates, which impact both plans and patients. This “rate notice period” stimulates significant debate around policy changes to the program.  
In early March, the Partnership for the Future of Medicare (PFM) convened reporters, Hill staff and other health care stakeholder groups for a briefing on the impact of recent legislative and regulatory changes to MA. These changes affect physician payment, care delivery, patient access and the Medicare program’s ability to move from a volume to value-based system.
Throughout the briefing, PFM co-chairs Doug Holtz-Eakin, PhD and Kenneth Thorpe, PhD, as well as Don Crane, president and CEO of CAPG, emphasized the following points:

  • Despite MA’s popularity, the program continues to face cumulative cuts that threaten seniors’ access to important health care services, such as chronic disease management programs and home and community-based services.   
  • MA’s capitated payment model incentivizes integrated, patient-centered and value-based care, which aligns with the Administration’s announcement to move 50 percent of fee-for-service (FFS) beneficiaries to value-based health care delivery models by 2018.[i]
  • Additional cuts to MA would force plans to reduce services for beneficiaries, such as transportation and social support services, which disproportionally impacts low-income seniors.[ii]
  • Further cuts to MA could also push seniors out of MA to FFS Medicare, increasing the Medicare program’s costs due to FFS’s focus on volume, not value.[iii]
  • More cuts to MA force plans to be more conservative, which can hinder the future innovation needed to transition to a higher-value, higher-quality health care system.[iv]

The Partnership for the Future of Medicare is a bi-partisan organization dedicated to the long-term security of Medicare, including MA. The organization serves as a convener and resource of information, broad perspectives, and good ideas related to Medicare reform. To learn more about our path forward, see here


[ii] 2016 Advance Notice: Changes to Medicare Advantage Payment Methodology and Potential Effect of Medicare Advantage Organizations and Beneficiaries. Oliver Wyman. February 25, 2015

[iii] Ibid.

[iv] Ibid. 


Monday, April 6, 2015