Politicians usually avoid proposing changes to Medicare in an election year, but the program’s rising costs and expected insolvency within the next five to 10 years will demand attention in the next presidential term. The question will be how to reduce spending while preserving benefits for seniors. The best approach is to build on the success of Medicare Advantage.
In traditional Medicare, the government decides what services it will cover and the price it will pay. In MA, seniors choose private coverage options where plans make more of those decisions in a competitive market. Most Medicare enrollees choose MA because it offers them better value.
MA enrollees tend to have more preventive care visits, fewer hospital admissions with shorter stays, and lower healthcare spending. Since MA plans deliver better health outcomes and more coordinated care, their average cost of covering core Medicare benefits is much lower — about 17% below traditional Medicare. Plans pass part of these savings to taxpayers and the rest to enrollees in the form of lower expenses or extra benefits that are not covered by traditional Medicare, such as dental, vision, and hearing coverage.
