MVP Health Care is dropping certain Medicare Advantage products for New York seniors on a fixed income, citing cuts in federal reimbursements and an uncertain health care market caused by Obamacare.
Denise V. Gonick, MVP President and Chief Executive Officer, made the announcement today and blamed “truly unsustainable” economics for the decision.
These Medicare Advantage products currently cover nearly 20,000 members statewide.
At a press conference, Gonick said “MVP can no longer afford to offer them, and we believe plan members – seniors living on fixed incomes – will not be able to afford the premiums we would have to charge for them.”
Saying it was “not fair to our seniors,” Gonick went on to cite a variety of reasons for the bad economic forecast.
MVP is faced with a series of economic issues, including reduced Medicare Advantage payments, sequestration, a reduced Part D subsidy, and a two percent health insurance tax on premiums. At the same time, the cost of medical care continues to spiral upward.
Sequestration, despite what the media had reported at the time, was an idea spawned by the Obama administration.
Meanwhile, Medicare Advantage payments were reduced due to the Affordable Care Act, which would have been exponentially worse had the administration followed up on their original planned payment cuts.
Additionally, the Affordable Care Act was supposed to reduce health care costs, not see them “continue to spiral upward” as Gonick stated. President Obama repeatedly claimed his reform plan would “reduce health care costs and make coverage more affordable for all Americans.”
There is no escaping the fact that the move by MVP Health Care is directly linked to Obamacare.
The Albany Business Review writes:
Denise Gonick, president and CEO of MVP Health Care, said the system for paying for health care is broken, at least temporarily.
Insurers are losing revenue because of new taxes, government spending cuts and other changes tied to the Affordable Care Act, or ACA. They also have to spend more money if they plan to sustain some health insurance coverage plans, especially those for the elderly.
“In the long run, we don’t think that is a recipe for success,” said Gonick, who heads the Schenectady-based insurer with 700,000 members in New York state.
Obamacare is certainly not a recipe for success – either for insurers or consumers.
Further linking the drop in Medicare products for New York’s seniors is the uncertain economic and health care outlook caused by Obamacare for the future.
Gonick announced that while MVP supports the goal of providing health care to all, “MVP and other health insurers in New York State and elsewhere face several more years of disruption as health care reform continues to roll out.” She added:
Unfortunately, health care costs continue to soar. You can’t spend money that you don’t have.
Earlier this year, MVP Health Care was forced to reduce its workforce, cutting 100 jobs due to Obamacare.
Cross-posted at the Mental Recession