Shares of several health insurers climbed in premarket trading Tuesday, a day after the federal government released final Medicare Advantage rate data for next year that points to less severe funding cuts than investors had originally feared.
Health insurers and analysts who cover the industry had warned that companies offering Medicare Advantage plans would be forced to cut benefits, hike the premiums their customers pay significantly or leave some markets after the Centers for Medicare and Medicaid Services released some preliminary data in February.
CMS said then that the amount it pays per person for the popular coverage could fall more than 2 percent in 2014. Some analysts said the actual payment Medicare Advantage plans receive could fall as much as 8 percent, counting other variables like a premium tax called for as part of the health care overhaul.
CMS allowed for a 45-day waiting period for comments before releasing final 2014 data on Monday. It then said it now expects the cost per person to rise more than 3 percent. Analysts expect that the amount that plans receive will still fall, but by a much lower extent.
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