Medicare Advantage Premiums to Decline by Nearly 8%

Groups are applauding CMS for lowering premiums ahead of the upcoming Medicare open enrollment period.

The Biden administration announced it will lower premiums for Medicare Advantage (MA) plans in 2023, a decision backed groups like America's Health Insurance Plans (AHIP) and Better Medicare Alliance (BMA).

Beneficiaries will see the projected average premium for MA plans decrease nearly 8%, from $19.52 in 2022 to $18 per month next year.

The announcement comes in the lead-up to the Medicare open enrollment period, which runs from October 15 to December 7. CMS said it projects enrollment will reach 31.8 million people in 2023.

The administration is also highlighting the effects of the new Inflation Reduction Act on Medicare prescription drug coverage, which includes a $35 cost-sharing limit on a month's supply of each covered insulin product.

"The Inflation Reduction Act will provide much needed financial relief and increase access to affordable drugs," said CMS Administrator Chiquita Brooks-LaSure. "It is more important than ever for people to review their health care coverage and explore their Medicare options during Open Enrollment this year."

Supporters of MA have touted CMS' decision to cut premiums, with AHIP president and CEO Matt Eyles noting that health insurers are doing their part to improve affordability.

"More than 29 million seniors and people with disabilities choose Medicare Advantage because it delivers better services, better access to care, and better value," Eyles said in a statement. "Today's announcement from CMS is a further demonstration of that value. Even as average premiums continue to decline, Medicare Advantage offers benefits well beyond those in original Medicare does not, such as a cap on out-of-pocket costs; integrated vision, hearing, and dental benefits; and comprehensive prescription drug coverage.

Meanwhile, MA advocacy group BMA also responded to CMS' announcement with praise.

"With the lowest average monthly premiums in 16 years, and separate data showing that Medicare Advantage saves seniors nearly $2,000 per year on total health expenditures, Medicare Advantage is poised to bring meaningful health and financial security to millions of seniors in 2023," said Mary Beth Donahue, BMA president and CEO.