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Medicare Advantage faces less pressure to cut benefits

Medicare Advantage health plans will face less pressure to cut benefits or leave some markets next year after the government released a favorable early assessment of factors affecting rates.

The Centers for Medicare and Medicaid Services laid out a payment and policy update for 2017 on Friday after markets closed. The announcement includes an assessment of several variables that can affect the price of coverage. Analysts say it boils down to a rate increase of around 3.5 percent when including adjustments made to account for the health of patients covered by a plan.

Rates for 2017 will be finalized in April, and the actual change will vary depending on factors like where the plan is located. Nevertheless, the announcement was viewed favorably.