JustCare

Tag: Overpayment

  • Sen. Warren and Rep. Jayapal urge CMS to end Medicare Advantage overpayments, punish bad actors

    Sen. Warren and Rep. Jayapal urge CMS to end Medicare Advantage overpayments, punish bad actors

    Ahead of the Centers for Medicare and Medicaid Services’ (CMS’) release of proposed payment policy for Medicare Advantage plans, Senator Elizabeth Warren and Representative Pramila Jayapal sent a letter to the Centers for Medicare and Medicaid Services detailing ways the administration could wipe out a projected $100 billion in overpayments to MA plans this year alone. Among other things, the letter proposes ending contracts with MA plans that violate their duty to cover Medicare benefits.

    “It is imperative for [Medicare] to rein in these abuses and protect Medicare coverage for the seniors and people with disabilities who rely on it,” say Warren and Jayapal. Last month, Senator Warren wrote CMS to start collecting critical data needed to oversee the Medicare Advantage plans.

    Thirty-one million older adults and people with disabilities are enrolled in Medicare Advantage plans. These health plans cost taxpayers $500 billion last year. But, substantial evidence indicates that the government overpays insurers offering these plans tens of billions of dollars each year; and, some, if not many, of these MA plans inappropriately deny and delay care to their enrollees, especially care for people with complex and costly conditions.

    The Biden administration has taken some steps to end some of the overpayment abuses. But, many experts believe there’s a lot more to be done. Mark Miller, former director of the Medicare Payment Advisory Commission, says “If [the Centers for Medicare and Medicaid Services] backs down … then the beneficiary and taxpayer lose.”

    CMS gave the insurers immunity from overpayments detected over seven years of audits. CMS now plans to conduct more auditing of MA plans’ billing processes. Warren and Jayapal are looking for payment policy changes as well as audits. For example, they want the government to adjust payments to MA plans because their enrollees are healthier than enrollees in Traditional Medicare.

    The five-star quality rating system for MA plans also needs an overhaul. People cannot rely on the star-rating system as an indicator of whether an MA plan inappropriately denies care or has a narrow network that undermines their ability to get good care. Yet, the government pays insurers more for MA plans with a 4 or 5 star-rating.

    Moreover, some data show that some MA plans provide their enrollees fewer benefits than they would get in Traditional Medicare, even though they are legally required to cover the same benefits. CMS has not penalized plans that inappropriately deny care. Warren and Jayapal want CMS to hold them accountable and end their contracts.

    In some instances, UnitedHealth Group has denied rehab care to patients in critical need of rehab, based on computer algorithms, to the detriment of their enrollees’ health and well-being. Even though CMS said it may punish insurers who violate their contracts by wrongly denying care, it has yet to do so.

    CMS has ended contracts with Centene Medicare Advantage plans in Arizona and North Carolina because their star-ratings were three or below for three years running.

    Here’s more from Just Care:

  • Even with billions in overpayments, Medicare Advantage insurers are losing value

    Even with billions in overpayments, Medicare Advantage insurers are losing value

    The latest news suggests that Humana and other big insurers are losing shareholder value because they are spending more money on care in Medicare Advantage than anticipated. It’s hard to believe they aren’t profiting wildly when they have been running away with the store, raking in tens of billions of dolloars in overpayments from the government each year. But, if they are losing value, it’s another reason why Congress should cut its losses on Medicare Advantage and either overhaul the program or end it entirely.

    If insurers deliver shareholder value by spending less on care, then shareholder value is at odds with the needs of Medicare Advantage enrollees. And, if insurers can’t deliver shareholder value when they are massively overpaid, Medicare Advantage enrollee costs are likely to rise significantly when the government ends the overpayments. Right now, the Medicare Advantage plans are being overpaid $88 billion, according to the Medicare Payment Advisory Commission or MedPAC.

    No one, including many Democrats in Congress, wants to hear that Medicare Advantage is financially unsustainable and not delivering shareholder value. After all, as one Just Care reader just wrote me, it’s the only option many people with Medicare believe they can afford.  (Traditional Medicare has no out-of-pocket limit. So, unless they have Medicaid, people need supplemental coverage to protect themselves financially, and supplemental coverage can be expensive. That said, out-of-pocket costs in Medicare Advantage can be over $8,000 a year for in-network care alone, which presents a significant barrier to care for many enrollees with complex and costly conditions. People in Medicare Advantage cannot buy supplemental coverage.)

    It’s an open question whether Traditional Medicare without supplemental coverage is a better option for people with limited incomes than Medicare Advantage. At least, the government is not second-guessing their treating physicians or limiting their access to physicians and hospitals. Medicare Advantage is not working for millions of people with costly conditions; they often can’t get the care they need. When they need care, it’s a crapshoot whether their insurers will approve it and whether they will be able to afford the out-of-pocket costs.

    What’s crystal clear is that Congress and the administration need to cut Medicare Advantage overpayments really soon if Medicare is going to be around in the future. These overpayments are unsustainable, and they are undermining Traditional Medicare. Without Traditional Medicare, the Medicare Advantage insurers will have no competitive pressure and their behavior, which already too often endangers people’s health and well-being, is likely to worsen.

    Politically, many Democrats are likely to feel that their hands are tied, and they cannot support reforms to address the overpayments without a backlash from insurers. Republicans seem happy to allow the waste in Medicare Advantage to continue, because it’s helping the corporations that support them. But, only when Congress ends the Medicare Advantage overpayments will Republicans and Democrats serve the needs of all their constituents and ensure Medicare’s future.

    Here’s more from Just Care:

  • Medicare Advantage needs serious fixes; $88 billion in government overpayments must end

    Medicare Advantage needs serious fixes; $88 billion in government overpayments must end

    The Medicare Payment Advisory Commission (MedPAC), a non-partisan independent agency, last week projected $88 billion in government overpayments to Medicare Advantage in 2024 and debated the value of the program, reports Noah Tong for Fierce Healthcare. While the $88 billion projection is lower than other analysts’ projections, it is serious money that is threatening the solvency of the Medicare Trust fund, endangering the Medicare program writ large, and driving up everyone’s Medicare costs.

    One MedPAC commissioner thought the MedPAC report was “too negative.” In truth, it couldn’t be negative enough, given the mountains of evidence that the Medicare Advantage plans are not only wildly overcharging the federal government but engaged in widespread and persistent delays and denials of care, while failing to disclose critical data to allow analysts to assess the quality of their coverage. And, this MedPAC commissioner did say: “There are plenty of bad things definitely that need to be improved.:

    For its part, the “Better Medicare Alliance,” an advocacy organization funded by the insurers, tout the extra benefits they offer. But, these benefits, such as dental services, are often extremely limited and most people appear not to be helped by them. Before, they’re available only because of the $88 billion in overpayments the MA plans receive each year.

    Another MedPAC commissioner highlighted that only people who are quite ill have serious problems with Medicare Advantage. Of course, that’s the problem, since everyone in Medicare Advantage has the coverage because they could become seriously ill. They don’t need the coverage if they’re relatively healthy.

    People who are in need of care face prior authorization denials, or can’t find a specialist to see or can’t use a cancer center of excellence. People don’t think about these issues when they enroll in Medicare Advantage if they’re healthy. If they did, they would seriously consider enrolling in Traditional Medicare. Traditional Medicare has no insurer middleman second-guessing your treating physicians. Moreover, unlike Medicare Advantage, it covers your care from virtually all doctors and hospitals in the US without the need for prior authorization.

    One MedPAC commissioner nailed the problem, without agreeing with his own stated conclusions:  “What conclusion should I reach: that CMS leadership is unable to oversee the MA market, or that the recent and appropriate RADV audits are totally ineffective? In fact, CMS cannot oversee 4,000 plans all operating with proprietary administrative processes, failing to provide data they are required to disclose

    Gregory Poulsen, another MedPAC commissioner who is a senior vice president at Intermountain Healthcare, correctly pointed out that some MA plans do not add value and are not as good as others. Plans that are insurer-run, rather than physician/hospital run, tend to deliver poorer care which manage care to bring down spending. Some of the big insurers know how to maximize their revenue by gaming the payment system.

    Today, about half of people with Medicare are enrolled in a Medicare Advantage plan, most in a UnitedHealth plan or a Humana plan, possibly undercutting competition. The program in place to improve quality is a very expensive joke, failing to assess quality effectively.

    Lynn Barr, a MedPAC commissioner and founder of Caravan Health emphasized the excessive overpayments to Medicare Advantage. “I believe this is what the data shows. We have allowed MA to buy the market. That is why MA is growing. It’s not because the quality is so great. People don’t love the prior authorizations, people are leaving their plans a lot. This is not the big, lovely success everyone says it is. We continue to create policy that drives people into these plans.I think we’ve got do something to reduce these payments to MA.”

    Here’s more from Just Care:

  • The government overpays insurers offering Medicare Advantage as much as $140 billion in 2023

    The government overpays insurers offering Medicare Advantage as much as $140 billion in 2023

    A new report from Physicians for a National Health Plan (PNHP) reveals that the federal government is overpaying health insurance corporations offering Medicare Advantage plans as much as $140 billion in 2023. Matthew Cunningham-Cook and Lucy Dean Stockton report for Jacobin on PNHP’s report and the four ways the government overpays for Medicare Advantage at the same time that the Medicare Advantage plans engage in inappropriate delays and denials of care and coverage.

    The total annual Medicare Advantage overpayments would cover the full annual cost of part B premiums for everyone with Medicare, which usually is taken out of people’s Social Security checks. People with Medicare typically are left with about $1,600 in Social Security benefits. Not only are people with Medicare paying more than they should as a result of the Medicare Advantage program, the insurers offering Medicare Advantage plans, including UnitedHealthcare, Cigna and Humana, are “quietly plundering the the Medicare Trust Fund,” says Ed Weisbart, a physician who serves as PNHP’s secretary.

    With traditional Medicare, administrative costs are less than two percent and no one is profiting. With Medicare Advantage, insurers receive for each enrollee about 119 percent of what the government spends on enrollees in traditional Medicare because they are able to game the system.

    To be clear, Congress established Medicare Advantage, Part C of Medicare, arguing that it would save Medicare money. To the contrary, it has always cost more than traditional Medicare. The Medicare Advisory Payment Commission or MedPac has documented some of the overpayments.

    In short, the payment system to Medicare Advantage plans is defective, leading to gross overpayments. As bad, it makes it more profitable for the insurers offering Medicare Advantage to delay and deny care. The government pays them the same amount regardless of how much they spend on people’s care.

    Consequently, evidence abounds regarding people enrolled in Medicare Advantage who suffer and die prematurely because they are unable to get the care they need. They wait so long to get prior authorization from their Medicare Advantage plan that it is too late for them to get the treatment they need. Or, the Medicare Advantage plan denies them the needed treatment. Or, the Medicare Advantage plan has no top cancer providers in its network and they are either forced to get lower quality care or pay the full cost of care themselves.

    People are generally locked into their Medicare Advantage plans once they join, even though they are told that they can switch back to traditional Medicare each year during the open enrollment period. Because traditional Medicare does not have an out-of-pocket limit, they do not want to take the risk of signing up for it without also getting supplemental coverage to protect them from financial liability. But, insurers do not have to sell them this insurance except in limited situations after they first enroll in Medicare and, if the insurers are willing to sell them insurance, they can often charge astronomical prices for the coverage.

    In addition, hospitals and physicians can drop their contracts with Medicare Advantage plans as they will. And, they are doing so. The CEO of Scripps, a health system in California says: “We are a patient care organization and not a patient denial organization and, in many ways, the model of managed care has always been about denying or delaying care — at least economically.”

    Scripps is not alone. Throughout the country, in myriad states, including Ohio, Virginia, Oregon, Missouri, Oklahoma, and South Dakota, hospitals and physicians have pulled out of their Medicare Advantage contracts because of patient safety concerns, inappropriate denied claims and prior authorization headaches.

    How do Medicare Advantage plans profit so much?

    1. By marketing to and enrolling disproportionately more healthy people than traditional Medicare. Healthy people cost them very little, but the government still pays them around $12,000 for each healthy person. When people get sick and go without care because they can’t afford the copays in Medicare Advantage or can’t find a physician to provide them the care they need, the Medicare Advantage plans continue to profit. MedPAC says that Medicare Advantage plans receive about $44 billion to $56 billion more than they should as a result.
    2. By adding diagnoses codes to enrollee medical records, even when the enrollee is not getting more care, so that the government pays them more for these enrollees. This practice is called “upcoding.” And, it leads to $27 billion more in spending in 2023.
    3. By receiving bonuses for serving certain communities and based on quality benchmarks. But, neither are appropriate, according to MedPAC. Currently, Medicare provides bonuses to Medicare Advantage plans based on the locations they cover, supposedly to ensure equal geographic access to coverage. These overpayments total around $24 billion a year.
    4. By requiring their enrollees to pay part of the cost of their care each time they get care. Consequently, people in Medicare Advantage tend to forego care more often than people in traditional Medicare. The vast majority of people in traditional Medicare have supplemental coverage that relieves them of the need to pay anything beyond the cost of coverage for their care. So, people with traditional Medicare end up getting more care than people in Medicare Advantage, but the government pays Medicare Advantage plans as if their members get the same amount of care as people in traditional Medicare. This adds an additional $36 billion in overpayments.

    Here’s more from Just Care:

  • Republicans in Congress “outraged” by billions in Social Security overpayments to vulnerable older adults, silent about overpayments to insurers selling Medicare Advantage plans

    Republicans in Congress “outraged” by billions in Social Security overpayments to vulnerable older adults, silent about overpayments to insurers selling Medicare Advantage plans

    Kaiser Health News reports that Republicans in Congress are “outraged” by $20 billion in Social Security overpayments to vulnerable older adults. What no one has reported is the silence among Republicans in Congress about the hundreds of billion of dollars in overpayments over the last several years to insurers offering Medicare Advantage plans. Apparently, when the recipient of billions in overpayments is a big corporation that supports their campaigns, Republican policymakers can look the other way.

    These members of Congress want the Social Security Administration to answer for the Social Security overpayments. But, they don’t seem to want the Centers for Medicare and Medicaid Services to answer for the overpayments to insurance companies offering Medicare Advantage plans. Their silence suggests that they don’t seem to want the corporate health insurers to return the tens of billions of Medicare dollars they have received.

    Unlike the health insurers who have billions of dollars in their coffers to return the billions they were overpaid, a lot of the people who received Social Security overpayments are poor and no longer have the money they were overpaid. They can’t repay it.

    “The government’s got to fix this,” said Senator Sherrod Brown (D-Ohio). He chairs a Senate panel that oversees Social Security.  Senator Brown also has called for CMS to address the Medicare Advantage overpayments.

    Republicans in Congress are calling for a Congressional hearing and a fix to the Social Security overpayments but have been silent about Medicare Advantage overpayments. For example, Senator Rick Scott of Florida, who is a member of the Committee on Aging, asked about how the Social Security overpayments grew to $20 billion and wants someone to be held accountable “for, you know, messing this up.” He has never spoken about Medicare Advantage overpayments. let alone called for a hearing about them or questioned CMS for making them.

    Older adults are receiving overpayment notices from Social Security. They are losing sleep, unable to pay the money back. In one case, Social Security demanded a woman repay $5,575 in retirement benefits. It then stopped sending her checks in order to recoup the money. No one in Congress has suggested that CMS should withhold payments to Medicare Advantage plans to collect the tens of billions in overpayments CMS has not received back.

    Some members of Congress are calling for Social Security to stop trying to collect the overpayments from their constituents. It was not their mistake. But, again, few in Congress and no Republicans are calling on CMS to collect back overpayments from corporate health insurers, stemming from their overcharges.

    Here’s more from Just Care:

  • New study finds billions in overpayments to Medicare Advantage plans

    New study finds billions in overpayments to Medicare Advantage plans

    If you’re enrolled in a Medicare Advantage plan, you could be benefiting from billions of taxpayer dollars in overpayments to Medicare Advantage (MA) plans. More likely, you could be suffering from widespread and persistent inappropriate delays and denials of care and ghost networks, without doctors who are willing to take your insurance. One thing’s for sure, there’s little you can count on about your MA coverage.

    In addition, notwithstanding the government’s massive overpayments to Medicare Advantage plans, millions of people in Medicare Advantage plans struggle to afford their care. Between high copays, inappropriate denials and narrow networks that keep people from seeing the health care providers they want to see, people in Medicare Advantage are at risk of not getting the care they need. The federal government does not name the bad Medicare Advantage actors, so people are left to choose blindly among MA plans.

    Moreover, a new study in Health Affairs out of the Brown University School of Public Health finds that the way our federal government sets the benchmark for paying Medicare Advantage plans–how it determines how much to pay for each enrollee–is seriously flawed. As a result, the researchers find that the federal government overpaid Medicare Advantage plans by an average of $9.3 billion a year in 2017, 2018, 2019 and 2020. What will the Congress and the Biden administration do about this huge payment defect?

    To be clear, $9.8 billion a year in Medicare Advantage overpayments from using a flawed benchmark is only a piece of the overpayment problem. Another study out of the University of Southern California found that the federal government is overpaying Medicare Advantage plans $75 billion this year. Medicare Advantage enrollees are healthier, overall, than enrollees in Traditional Medicare, but the government pays MA plans as if their enrollees are less healthy than enrollees in Traditional Medicare.

    The Brown University researchers call for the government to change the way it adjusts for risk when it sets the amount it pays for each enrollee in Medicare Advantage in order to offset the $9.8 billion in overpayments to Medicare Advantage plans. Truth be told, no one has come up with a good way to design a payment system that does not lead to inappropriate payments. Moreover, no one has come up with a way to incentivize MA plans to cover the care people need, without delay, from the best health care providers.

    The Medicare Payment Advisory Commission has determined that, all told, the government overpays Medicare Advantage plans by 19 percent; it pays these plans 119 percent of what it spends in Traditional Medicare. It’s time to end the defective capitated risk-adjusted payment system and pay the MA plans differently.

    Here’s more from Just Care:

  • Humana sues government in effort to keep billions in overpayments

    Humana sues government in effort to keep billions in overpayments

    For no good reason, our federal government pays Medicare Advantage plans a set amount per enrollee regardless of the amount these health plans spend on care and regardless of whether they inappropriately delay and deny care and deny payments to providers. Moreover, our government pays the insurance companties extra if they add diagnosis codes to patient records, even when patients have not received treatment for those diagnoses. Now, FierceHealthcare reports that Humana is challenging the government’s new standards for getting some of the overpayments back.

    It seems reasonable that if the government found that it was overpaying Medicare Advantage plans, it could get its money–taxpayer dollars–back. Not so. It turns out that the government’s payment system not only overpays Medicare Advantage plans collectively tens of billions of dollars a year, but it struggles to recoup any of these overpayments.

    Humana’s recent lawsuit challenges the government’s new Medicare Advantage auditing standards. It argues in its lawsuit against the Centers for Medicare and Medicaid Services (CMS), which administers Medicare, that if the government recouped overpayments, Medicare Advantage plans and their enrollees could be harmed.

    Put simply, Humana likes the overpayments and wants to keep them. As it is, the government’s new standards for recouping overpayments have an extremely short look-back period, to 2018. So, billions in government overpayments through 2017–our Medicare dollars– already belong to the health insurers.

    Humana’s legal challenge centers on the fact that the government’s final rule regarding its ability to recoup overpayments to Medicare Advantage plans does not allow the Medicare Advantage plans to keep any of the overpayments they receive. “CMS abused its discretion by concluding that retroactive application of the final rule is necessary to comply with statutory requirements,” says Humana.

    If Humana prevails, it is yet another reason why the Medicare Advantage payment system needs an overhaul. It is wasteful and inefficient.

    Here’s more from Just Care:

  • Government can easily cut $500 billion in Medicare Advantage waste

    Government can easily cut $500 billion in Medicare Advantage waste

    In an opinion piece for The Boston Globe, Andrew Ryan and David Meyers expose the waste and fraud in Medicare Advantage, the part of Medicare administered by corporate health insurers. While our divided Congress has little power to fix massive overpayments to these insurers, they explain how the Centers for Medicare and Medicaid Services (CMS) can cut $500 billion in waste over the next decade, without jeopardizing patient care.

    Ryan and Meyers explain that the waste and fraud in Medicare Advantage (MA) stem from three “big choices by CMS that allow the profiteering to go unchecked.”  If the profiteering continues, it threatens to deplete the Medicare Trust Fund, endangering the Medicare program. In the meantime, it drives up Medicare premiums not only for people in Medicare Advantage but for people in Traditional Medicare, which is administered directly by the federal government.

    Ryan and Meyers find that, overall, people in Medicare Advantage plans are less ill than their MA medical records indicate. Moreover, they are healthier than people in Traditional Medicare. CMS can change the way it calculates MA  payments, so that Medicare Advantage plans cannot game the system and they are not overpaid.

    Right now, Medicare Advantage plans do “chart reviews” of their enrollees. When they do, CMS permits Medicare Advantage plans to change their enrollees’ diagnoses codes to make them look less healthy than they are and increase their government payments.

    Medicare Advantage plans also do home assessments of some of their enrollees, again with an eye to adding diagnoses codes to their medical records or otherwise making their health seem poor. Ryan and Meyers have found that ending the MA plans’ ability to change or add diagnosis codes through chart reviews and home assessments and/or prioritizing  diagnosis codes from physician-patient encounters when calculating payments could reduce Medicare Advantage overpayments by $14.1 billion a year.

    CMS should also be auditing Medicare Advantage plans far more often than it does to protect against overpayments. It needs resources to undertake these enforcement efforts, but they should more than pay for themselves. The IRS returns $12 for every dollar it spends on enforcement. If CMS shifted resources to enforcement, it could reduce Medicare Advantage overpayments by $10 billion a year.

    Lastly, CMS should not be using the average spending on individuals in Traditional Medicare as a benchmark for payments in Medicare Advantage plans. Individuals in Traditional Medicare are in poorer health than individuals in Medicare Advantage. If CMS appropriately adjusted its benchmark to reflect these health differences, it could save more than $40 billion a year.

    If CMS undertook these three fixes, it could easily save $50 billion a year. That money could go to adding an out-of-pocket limit in Traditional Medicare. But, there’s a catch.

    The Republicans in Congress do not appear to care about this massive Medicare Advantage waste. The health insurance industry likely will come out strong to support Republican candidates for President and Congress if the Biden administration attempts to make these fixes. That threat tends to keep the Democrats in Congress and the Administration from acting.

    Silence is not an option if we want to strengthen Medicare and keep corporate health insurers from continuing to raid its Trust Fund. Let the Biden administration’s David, take on the corporate health insurers’ Goliath. The battle to strengthen Medicare should be worth waging.

    Here’s more from Just Care:

  • Congress sits on its hands while Medicare Advantage insurers gouge taxpayers and enrollees

    Congress sits on its hands while Medicare Advantage insurers gouge taxpayers and enrollees

    The Medicare Advantage program, Medicare Part C, which allows corporate health insurers to contract with the government to offer Medicare benefits, was born with the assumption that it could save Medicare money. Instead, a new report out of the mainstream USC Schaeffer Center for Health Policy and Economics estimates that Medicare Advantage plans are costing taxpayers and people with Medicare an additional $75 billion in overpayments this year alone. The report only confirms findings by University of California at San Diego professor, Richard Kronick, of massive government overpayments to Medicare Advantage, but Congress sits on its hands.

    Republicans in Congress don’t seem to care about eliminating all the waste in Medicare Advantage. It’s the health insurers offering Medicare Advantage plans that will help fund their 2024 reelection campaigns. And, that’s not something they want to jeopardize. Many Democrats in Congress also appear to live in fear of losing support from the corporate health insurers and are doing little to address the massive overpayments, as they should.

    How do these Medicare Advantage overpayments happen? Medicare Advantage overpayments happen for a variety of reasons, but the largest reason is that people enrolled in Medicare Advantage are considerably healthier than people in traditional Medicare.  Because of a defective payment system, the government pays Medicare Advantage plans as if their enrollees are sicker than people in traditional Medicare. The high proportion of people who are healthy in Medicare Advantage cost these Medicare Advantage plans on average less than $1,000 a year as compared to the more than $12,000 a year the government typically pays Medicare Advantage plans to care for them.

    MedPac, the agency overseeing these government payments, has calculated the overpayments at $27 billion this year because the Medicare Advantage plans assign multiple diagnosis codes to their enrollees in order to boost their earning and often get quality bonus payments as well. But, MedPac has not factored into its calculations the $50 billion or so a year in Medicare Advantage overpayments resulting from the Medicare Advantage population being so much healthier than the traditional Medicare population.

    The researchers at USC appreciate that the Medicare payment system for Medicare Advantage plans is defective and needs an overhaul. Paying the insurers offering Medicare Advantage plans as the government currently does leads to massive overpayments. The researchers, however, do not speak to the fact that the defective payment system–upfront payments unrelated to the cost of services delivered– also leads to massive inappropriate delays and denials of care to people. People with cancer, heart disease, stroke and other costly and complex conditions are most at risk–and that’s most of us, if not now, down the road.

    The USC researchers like the idea of competitive bidding among MA plans as an alternative to the current payment system, which I hear is a nonstarter from the MA plans’ perspective. That shouldn’t matter, but it does. Regardless, competitive bidding doesn’t address the need to ensure that the payment system stops creating a disincentive for the Medicare Advantage plans to withhold care from the people who most need it–the 10 percent of people with Medicare with the costliest conditions.

    The government’s payment system will be right only if and when the Medicare Advantage plans are promoting their high value care for people with cancer, heart disease and stroke. Until then, consider enrolling in traditional Medicare if you can. If you enroll in Medicare Advantage, beware the Medicare Advantage plans engaged in widespread delays and denials of care. The administration is not naming them for the most part. And sometimes, it is giving them four and five-star ratings.

    Here’s more from Just Care:

  • When will the Medicare Advantage scam end?

    When will the Medicare Advantage scam end?

    Matthew Cunningham-Cook writes for The Lever on why Medicare Advantage is a scam, focusing on the $20 billion in overpayments the insurers offering Medicare Advantage now receive each year. Health insurers are making a killing off of the Medicare Trust Fund, as are their top executives and shareholders. The only question is whether this raiding of Medicare will end in time to save Medicare or whether Congress will sit back and continue to let these excess payments happen.

    Humana profits totaled $2.8 billion last year.  The chief reason: Overpayments from Medicare, which resulted in Humana receiving 80 percent of its total revenue from Medicare. Cunningham-Cook pegs the overpyaments at $20.5 billion, a ton. He relies on the calculations of the Medicare Payment Advisory Commission, MedPac. But, other moderate analysts believe they are closer to $60 billion a year.

    Cunningham-Cook also fails to mention that the government is responsible in large part for these overpayments. It adjusts payments to Medicare Advantage plans based on the diagnosis codes insurers ascribe to their enrollees–a measure of how sick the enrollees are. And, it pays Medicare Advantage plans more for each diagnosis code, even when those codes have no bearing on the number or cost of services the Medicare Advantage plans are delivering to their enrollees.

    The insurers offering Medicare Advantage take advantage of this defective payment system. Why not? They are allowed to, for the most part. And, it earns them greater revenues.

    Cunningham-Cook rightly charges the Medicare Advantage plans with overbilling–they are hunting for diagnosis codes, even when the diagnoses have no bearing on the services their enrollees need. But, in many cases, the insurers are acting within the framework the government gives them to charge for their enrollees.

    The underlying issue is that the government seems to want to privatize Medicare, turn it over to the profiteer corporate health insurers and let older Americans and people with disabilities fend for themselves. It’s a good gig for the enrollees, so long as they’re relatively healthy. Their out-of-pocket costs are lower than they would be if they were in traditional Medicare where they would need to buy supplemental coverage to protect themselves financially. They also almost always get Part D prescription drug coverage at no additional cost, as part of the Medicare Advantage benefit package.

    But, people in Medicare Advantage are playing with fire. They get sick and all bets are off. They are likely to face large administrative and financial barriers to care, inappropriate delays and denials of care, and restricted access to specialty care. In 2o22, the Office of the Inspector General reported that Medicare Advantage plans wrongly denied about 1.5 million claims.

    While people are told they can go back to traditional Medicare, most are locked into their Medicare Advantage plans once they sign up. The supplemental coverage they need to protect themselves financially is often not available or, when it is, it is not affordable.

    The Biden administration proposed to slow down the overpayments with a one-percent rate increase this year. But, somehow the insurance lobbyists won the day, and the insurers ended up getting a three percent increase.

    The biggest insurers in the Medicare Advantage game are UnitedHealth, Centene and CVS Health, all of which are realizing enormous profits because of this line of business.

    Medicare’s financial well-being is at tremendous risk. So, is the health and well-being of people with Medicare. Even with the massive overpayments to the Medicare Advantage plans, the Medicare Advantage plans are delaying and denying critical care persistently. When the overpayments end, you can only imagine the consequences for their enrollees. Meanwhile, traditional Medicare gets weaker and weaker each year as more enrollees move to Medicare Advantage because of its lower upfront costs, not appreciating the great risks they are taking with their health and well-being or not able to afford the cost of the supplemental coverage they need in traditional Medicare.

    The Biden administration did finalize a rule that prevents the insurers from using certain diagnosis codes to earn higher payments. It’s not clear what the effect of those changes will be.

    Most people do not appreciate the risks they are taking with their health when they enroll in Medicare Advantage. They see the Joe Namath ads and assume Medicare Advantage is a good deal. The Centers for Medicare and Medicaid Services does little to help educate them about barriers to care and coverage that people in traditional Medicare do not face.

    There is no one in Congress currently advocating to end Medicare Advantage, even though it is a failed experiment. The data is in and the corporate insurers not only cost Medicare more per person, they engage in practices that too often lead to people not getting the care they need. And the larger Medicare Advantage becomes, the more politically difficult it is to control them.

    Here’s more from Just Care: