Opinion

Employers, Unions, Teachers Unite to Save MA Retiree Coverage

Although Washington, D.C. doesn’t often agree when it comes to health care policy, one exception is Medicare Advantage (MA). MA is the program through which private health insurance plans deliver Medicare benefits to more than 18 million beneficiaries. And last month, a bipartisan, bicameral supermajority of 369 members of Congress wrote to the Centers for Medicare and Medicaid Services (CMS) urging the agency to protect the MA program.
While the program has grown and is highly valued among seniors, beneficiaries are facing increased pressures of higher costs, reduced benefits and fewer provider choices.
Despite the bipartisan Congressional support and growing popularity of Medicare Advantage, CMS is proposing more cuts again this year. The proposed changes this year affect a specific type of MA plan provided by employers and unions known as MA Retiree Coverage (or Employer Group Waiver Plans (EGWPs)), which 3.3 million seniors, approximately one-fifth of all MA beneficiaries, rely on for health care coverage in retirement. The employers and unions who provide this type of coverage do so because MA Retiree Coverage offers enhanced quality of care, affordability and choice to retirees. These plans are so highly valued by employers and unions that enrollment has grown by 70 percent since 2009.
Despite the popularity and growth of MA Retiree Coverage, CMS is proposing a change that the Agency confirms would result in a cut of 2.5 percent.
So what could happen to retirees as a result of these cuts? It could lead to a reduction in the comprehensive benefits MA Retiree Coverage provides, fewer providers, and reduced access. According to an analysis conducted by Milliman, the proposed cut could cost each senior, on average, up to $264 a year in higher costs and reduced benefits.
All told, the total cost of these cuts for the 3.3 million retirees who rely on this coverage could be between $750 million – $870 million in 2017 alone. The millions of retirees enrolled in this program are highly satisfied with the coverage it provides, yet these seniors will likely not enjoy the same benefits if the proposed cuts go into effect.
Simply put, these proposed cuts could jeopardize comprehensive and affordable health care benefits for 3.3 million seniors.
What does MA Retiree Coverage provide retirees? MA Retiree Coverage gives seniors the financial stability and access to quality care that isn’t available in Medicare Fee-for-Service. Seniors enrolled in MA Retiree Coverage have improved health outcomes in comparison to Medicare, including reduced hospital readmission rates by almost 50 percent, and 25 percent fewer visits to the emergency room.
MA Retiree Coverage offers comprehensive health care coverage that includes Medicare Parts A and B services. It provides additional benefits and services that are not available in traditional Medicare, such as vision and dental benefits, case management services, annual in-home primary care, and prescription drug management tools integrated with medical benefits.
CMS’s proposed cuts put all of these benefits of MA Retiree Coverage at risk. This is not only health coverage that seniors rely on – this is coverage offered as a promise to employees, and 3.3 million retirees have earned it.
Our Coalition represents more than 55 labor unions, employers and municipal governments who all stand by this promise, and that is why we’re aligning to reverse the proposed cuts before the April 4 deadline.
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