• Thu. Apr 25th, 2024

Medicare Advantage Plan Payment Increases Fall Short, Putting Pressure on U.S. Health Insurers

BySamantha Nguyen

Apr 2, 2024
Health insurance company shares decline as last Medicare Advantage rates fall short – NBC Chicago

The recent decision by the Biden administration to not increase payments for private Medicare plans as much as anticipated has put additional pressure on U.S. health insurers, which are already dealing with high medical costs and uncertainty following the ransomware attack on UnitedHealth Group’s tech unit. The Centers for Medicare and Medicaid Services (CMS) announced that government payments to Medicare Advantage plans would only rise by 3.7% year over year, which is below what was expected.

Following this announcement, several health insurers experienced stock declines, including CVS Health, UnitedHealth Group, Elevance Health, and Centene, which all fell more than 3%. Humana, which heavily relies on private Medicare plans, saw its stock fall by over 10%. This news has had a significant impact on companies that rely on Medicare Advantage plans for growth and profits. The rates set by the CMS have significant implications for insurers, affecting monthly premiums, plan benefits, and ultimately profitability.

Medicare Advantage plans are a popular option for over half of Medicare beneficiaries due to their lower monthly premiums and added benefits not available with traditional Medicare plans according to KFF. However, this news has created uncertainty in the market and may lead to further declines in the stock prices of health insurers in the coming weeks or months.

By Samantha Nguyen

As a content writer at newsqwe.com, I am passionate about crafting engaging and informative articles that captivate our audience. With a background in journalism and a keen eye for detail, I strive to deliver content that is not only well-researched but also adds value to our readers' lives. From breaking news stories to in-depth features, I take pride in my ability to tell compelling stories that resonate with our diverse audience. When I'm not typing away at my keyboard, you can find me exploring new cafes, practicing yoga, or getting lost in a good book. I am thrilled to be a part of the newsqwe.com team and look forward to sharing my love for writing with all of our readers.

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