A Letter from the President of Physicians for a National Health Program on Medicare Advantage
The era of ever-expanding commercial health insurance industry growth and the Medicare Advantage Denial of Care business model is coming to an end
Commercial health insurance companies are used to getting their way.
When lobbyists for firms like UnitedHealthcare or Blue Cross and Blue Shield issue their demands, policymakers have a bad habit of complying first and asking questions later.
But not this time.
One of the biggest priorities for corporate health insurers is using American taxpayer dollars to pad their bottom lines. Medicare and Medicaid are real growth areas for them, to the detriment of patients who have to suffer through delays, navigate narrow provider networks, and pay unexpected out-of-pocket costs—often at the worst possible time.
Every year, administrators at the Centers for Medicare and Medicaid Services (CMS) propose a rate increase for so-called “Medicare Advantage” plans—which are already extremely lucrative for corporate insurers—and every year lobbyists pressure federal policymakers to increase their proposed rate hike. This type of lobbying is almost always successful. For example, last year’s final rate increase was more than three times as large as the initial proposal. But this year, federal administrators stood by their initial 3.7% increase, sending a message to corporate insurers that the Medicare Advantage gravy train is finally be slowing down.
This type of pushback is long overdue, since policymakers have been hearing a steady drumbeat of criticism about corporate profiteering in Medicare.
The (many) problems with Medicare Advantage:
• New York Times report: Insurance firms exploited Medicare Advantage for billions, and agreed to large settlements in fraud cases with state and federal governments
• PNHP report: Medicare Advantage plans overcharge taxpayers by up to $140 billion per year, money that could be used to totally eliminate Medicare Part B premiums
• U.S. House letter: Corporate health insurers cause real harm to seniors and people with disabilities; they must be scrutinized and traditional Medicare must be improved
We’ve known for years that corporate health insurers are bad for patients, bad for doctors, and bad for Medicare. So why are these well-worn arguments finally making an impact? Because thousands of seniors, people with disabilities, and health care professionals are raising their voices to say enough is enough.
This win would not be possible without countless emails, phone calls, in-person meetings, and direct actions that have pushed policymakers to respond. Support our campaign to Heal Medicare with a tax-deductible donation!
At this point, it’s safe to say that we have the industry’s attention—and make no mistake about it, they will strike back. Their declining stock prices make it clear that corporate health insurers depend on profiteering to ensure profitability, and that they will fight tooth and nail to protect their ill-gotten gains.
But our movement is growing, and we are building the kind of power that can win even more impressive victories to curb corporate profiteering, to improve the public Medicare program, and to win the kind of single-payer national health program that will turn the abuses of corporate health insurance into a distant memory.
In solidarity,
Phil Verhoef, M.D., Ph.D.
President, Physicians for a National Health Plan
Additional Resources
Learn more about the Medicare Advantage Harm-for-Profit and Denial of Care business model:
'Deny, deny, deny': By rejecting claims, Medicare Advantage plans threaten rural hospitals and patients, say CEOs - NBC News
Massachusetts U.S. Sen. Elizabeth Warren is warning buyers to beware of some Medicare Advantage health insurance plans for seniors. Warren said many commercial insurers are "boosting their profits with a lot of denials of care," and "threatening the solvency of the Medicare system overall." -WBUR Boston
Hospitals and Doctors Are Fed up With Medicare Advantage - Kaiser Health News
The Great Medicare Advantage Marketing Scam - American Prospect
Medicare Advantage Is a $140 Billion Scam - Jacobin
Denied by AI: How Medicare Advantage plans use algorithms to cut off care for seniors in need - STAT News / Boston Globe