Medicare Advantage premiums soar 14% in 2010

MedicareThat the escalating costs are fast becoming a predicament even for people who have steady insurance is evident from the fact that sharp premium increases are on their way to affect millions of senior citizens who signed up for Medicare’s popular private health plans.

As per a recently-released study by a leading consulting firm, premiums for Medicare Advantage plans that offer medical and prescription drug coverage soared 14.2 percent on average in 2010; following a 5.2 percent increase the earlier year. As many as 8.5 million elderly and disabled people have signed up for these plans, which offer more economical and more wide-ranging coverage than traditional Medicare.

The reason behind the increase in the 2010 premiums for Medicare Advantage is last year’s reduced governmental payments to the private plans. What is more disquieting is the fact that with the Democratic bills pending in Congress, there is a possibility of even more cuts in government’s payments.

Even though President Obama said at a town hall meeting outside Las Vegas on Friday that the Medicare Advantage plans are getting a “sweet deal” from the government, and called for “a competitive bidding process” to ensure “the absolute best bargain;” the Republicans have largely seized on the Medicare Advantage cuts’ opportunity to wreck the government’s health-care regulations.