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Study: Cuts to Medicare Advantage Top $1,500 Per Senior Study: Cuts to Medicare Advantage Top $1,500 Per Senior

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Study: Cuts to Medicare Advantage Top $1,500 Per Senior

Analysis says Obamacare cuts will affect all beneficiaries.


(Alex Wong/Getty Images)

Obamacare's Medicare Advantage cuts will lead to benefit reductions of about $1,500 per beneficiary, according to a new analysis from a conservative think tank.

The American Action Forum, founded by former Congressional Budget Office Director Douglas Holtz-Eakin, said almost all Medicare Advantage beneficiaries will feel the effect of cuts to the program.


The federal Medicare agency recently backed off a proposal to make additional cuts to Medicare Advantage—the second year in a row it has proposed and then abandoned such reductions. But the AAF analysis says the reductions mandated in the Affordable Care Act will still affect benefits for most seniors who use the program.

Roughly 30 percent of Medicare beneficiaries—about 16 million seniors—use the privately administered Medicare Advantage plans. The program continues to grow, despite the Affordable Care Act's cuts. Enrollment rose in 2014 to 15.9 million—roughly a 9 percent increase from the year before, according to a recent analysis from the consulting firm Avalere Health.

According to AAF, though, seniors who use Medicare Advantage are facing an average benefit loss of about $1,500 per year compared with pre-Obamacare rates. From 2014 to 2015, the average cut is about $300, or 3 percent.


The effects vary by state. Some, such as Alaska, will see slight increases in payments to Medicare Advantage plans, while others, including Louisiana, will face higher-than-average reductions.

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