How the Federal Government Could Push People Toward Medicare Advantage – And Replace Traditional Medicare

ICD10monitor December 18, 2024
Timothy Powell, CPA, CHCP

The Medicare Advantage (MA) program has grown significantly over the past two decades, becoming a popular alternative to traditional Medicare fee-for-service (FFS). As of 2023, more than half of Medicare beneficiaries have opted for MA plans, a trend driven by competitive offerings, additional benefits, and cost-sharing structures.

This shift has sparked discussions about whether the federal government should encourage or eventually replace traditional Medicare FFS with Medicare Advantage.

Financial Incentives for Medicare Advantage Plans

The federal government already provides financial incentives to MA plans through risk-adjusted payments. To accelerate the shift, Congress could increase these payments while simultaneously reducing reimbursements for traditional Medicare FFS. This strategy would make MA plans even more financially attractive for insurers, encouraging them to expand...

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