Upstate NY Health Plans Support Legislation to Defend Medicare Advantage Plans for Seniors

Upstate New York health plans are showing their support for recently introduced bipartisan legislation to protect benefits and access to care for hundreds of thousands of people enrolled in Medicare Advantage plans in upstate New York.

Excellus BlueCross BlueShield and MVP Health Care are speaking out in favor of the bipartisan legislation backed by Congresswoman Claudia Tenney (NY-24), Congressman Joseph Morelle (NY-25), Congresswoman Elise Stefanik (NY-21), Congressman Paul Tonko (NY-20), Congressman Nick Langworthy (NY-23), Congressman Brandon Williams (NY-22), and Congressman Marc Molinaro (NY-19).

A change last year in how the federal government sets hospital reimbursement rates for original Medicare resulted in a needed adjustment for upstate New York hospitals. The Medicare Wage Index adjusts a hospital's payments based on labor costs for a specific geographic area. The federal government increased the Medicare Wage Index for local hospitals by 20-40%. Senate Majority Leader Charles Schumer announced the $1 billion increase for upstate New York hospitals in August 2023.

This change, however, resulted in significant financial hardships for upstate New York nonprofit health plans. The health plans use the federal government reimbursement rates to determine payments for hospitals who treat Medicare Advantage members. The health plans are now reimbursing hospitals more for Medicare Advantage members without a corresponding increase in government funding.

“Without a solution, the wage index will significantly impact more than 400,000 Medicare Advantage members with nonprofit health plans in upstate New York,” said Jim Reed, president and CEO of Excellus BCBS. “We thank our Congressmembers for addressing this important issue. This legislation, if passed, would help us maintain the quality and affordability of our Medicare Advantage programs while also ensuring more support for our local hospitals.”   

The funding gap could impact the affordability of Medicare Advantage plans in upstate New York, potentially resulting in out-of-pocket increases and reductions in benefits.

"We thank Congresswoman Tenney, Senator Schumer, and our bipartisan Congressional delegation for supporting this imperative legislation,” said Chris Del Vecchio, CEO of MVP Health Care. “This bill will authorize the Centers for Medicare and Medicaid Services to make a region-specific Medicare adjustment to level the playing field for local, not-for-profit, community-based plans like MVP. It will ensure that MVP can continue to innovate with our community provider partners and provide critical supplemental benefits to our Medicare members."

The legislation would adjust the benchmark amounts reimbursed to health plans to ensure regional, nonprofit Medicare Advantage plans remain viable and members maintain their robust benefits and access to quality care.

Please read this news release to learn more about this bipartisan effort.