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The Impact of the Medicare Advantage Benchmark Cap on Beneficiaries

January 18, 2017

Key Facts

  • In Medicare Advantage plans that earn a high Star Quality rating receive a quality bonus they must apply to enhanced benefits. 

  • In some counties, the benchmark cap prevents these high-quality plans from receiving the quality bonus they earned.

  • As a result, beneficiaries do not receive the enhanced benefits enabled by quality incentives.

  • In 2016, over two million beneficiaries were denied enhanced benefits, including reduced cost sharing, due to the benchmark cap.

  • In total, over three million Medicare Advantage beneficiaries are enrolled in counties impacted by the benchmark cap.


Policy Recommendation

Congress or the Centers for Medicare & Medicaid Services (CMS) should remove the benchmark cap for 4-Star or higher plans to ensure all beneficiaries benefit from enrollment in high-quality plans.