While, many analysts expect overall payment rates to fall next year, Monday the federal government announced it will be bumping up the rate used to figure Medicare Advantage reimbursement to insurers.

The news has raised concerns on how lower reimbursements will impact plans that receive a government subsidy, generally offering more benefits than traditional Medicare and enable the elderly and disabled to receive benefits through private health insurers.

America's Health Insurance Plans, a trade association estimates Medicare Advantage payments could fall by 5% next year, with the cut leading to higher premiums and benefits reductions for over 10-million people, who are enrolled in Medicare Advantage.

Lower reimbursements according to analysts will hurt the earnings of private insurers who have large portions of Medicare Advantage business, such as, Humana Inc. based in Louisville, Ky. and HealthSpring Inc. of Nashville, Tenn.

According to The Centress for Medicare & Medicaid Services, the national average growth percentage per capita for Medicare Advantage plans will rise 0.8% in 2010.