Aaron Carroll writes for Academy Health on how Medicare Advantage has succeeded in attracting lots of enrollees but failed in lowering costs, coordinating care and saving the government money.
Throughout its lifetime, Medicare Advantage has cost the government more than traditional Medicare. This year alone, Medicare Advantage is estimated to cost $76 billion more than traditional Medicare, according to the Medicare Payment Advisory Commission. And, that means higher premiums for everyone with Medicare.
According to the Joint Economic Committee, in 2025, Medicare Advantage raised Medicare Part B premiums by $212. And, what do people in traditional Medicare get for that additional premium? Nada. People in Medicare Advantage also often lose out, particularly if they need costly and complex care because inappropriate delays and denials of care are widespread in Medicare Advantage plans.
Insurers game the defective payment system and add diagnoses codes to Medicare Advantage enrollee records to earn greater Medicare compensation for their services, even when they do not provide additional services to these enrollees.
Insurers also game the payment system by saying that they will spend less than county benchmarks. This allows them to keep the difference to pay for extra benefits, even if they are not paying for the Medicare benefits they contract to provide enrollees. People needing rehab services, skilled nursing services, cancer care and other complex services too often can’t get these services in Medicare Advantage, even though Medicare covers them.
Carroll says that people value the “extra” benefits, such as dental, vision, hearing, transportation, that some Medicare Advantage plans offer. And, they value the lower up-front costs in Medicare Advantage. But, he continues, these should be benefits that everyone gets or no one gets. Furthermore, the government rewards insurers for reaching administrative targets, not for providing better care.
Carroll also claims–based on the fact that people choose Medicare Advantage–that Medicare Advantage offers value. But, he believes that the government is paying too high a price for that value and that price is not related to better health outcomes. What he fails to consider is that the insurers offer no meaningful data to demonstrate they offer value, and independent research shows major failings with Medicare Advantage plans when it comes to covering medically necessary care.
Here’s more from Just Care:
- 2026: Medicare Advantage enrollment declines in seven states and enrollment in Traditional Medicare grows
- Ten ways to improve Medicare Advantage
- 2026: Five things to think about when choosing between Traditional Medicare and a Medicare Advantage plan
- Extra benefits in Medicare Advantage: Truth or Fiction?
- OIG finds widespread inappropriate care denials in Medicare Advantage
