What Are Medicare Advantage Cuts?


Quick Answer

Medicare Advantage cuts are funding changes that occur as the Medicare officials deem necessary. These cuts can be proposed annually for the budget that the government does every year, but they are not set in stone after the officials suggest them. The officials receive a lot of feedback and petitions from the public and other government officials either for or against the cuts, which can influence the officials' decisions according to the Roll Call news publication.

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Full Answer

The cuts are normally proposed to try to save money and balance Medicare's budget, but even if the cut gets passed, that does not mean that the end result will be an actual cut. When the cuts are set forth, they are done so on an estimate of the program's spending. If the Medicare Advantage spends less than the budget figured for they can actually end up gaining funds instead of losing them. As of 2015, the last time this occurred the officials called for a 0.9 percent cut in funding, but ended up giving the organization a 1.25 percent increase, as documented by the National Journal news publication. The budgets for the department are complied the year before and based on estimates. These estimates are made based on the previous years spending and tries to estimate what, if any, cost increases the department might see from service providers and beneficiary payments.

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