Medicare Advantage Plans Bad for Many Enrollees and All Taxpayers

These plans benefit insurance companies more than people in medicare.

These MA plans are a gigantic fraud scheme that is making billions of dollars for insurance companies.  TV and radio stations are filled with commercials working hard to tempt those in  medicare to switch to an advantage plan.  A fortune is spent on these by insurance companies because they make so much money from these Part C medicare plans.

In Part 1 I delve into the many reasons that individuals seeking to cut their medicare and medical costs generally do not fully understand how they lose medical freedom in ways that can harm their health. The key alternative to an MA plan is to stick with original medicare and buy supplement insurance.

In Part 2 I focus on how this program has ended up costing the government and taxpayers very high costs.

Part 1

After reviewing thousands of complaints about "confusing, misleading, and/or inaccurate" Medicare Advantage ads, and using "secret shoppers" to document deceptive telephone sales pitches, the Centers for Medicare & Medicaid Services (CMS) announced it is putting its foot down.

"Secret shoppers" found that 80% of agent calls with clients were inaccurate or insufficient. What a scam.

Many elderly Americans complain that they have no idea what they were signed up for, and were shocked that they were not on original Medicare any longer. Now they were in an MA plan, with all kinds of restrictions.  In other words, a phone call responding to a commercial can cause loss of original medicare.

The core problem is that touted benefits and cost savings may only be available in limited service areas or for limited groups of enrollees.  Benefits are overstated.  Agents and commercials often use words and imagery that may confuse beneficiaries or cause them to believe the advertisement is coming directly from the government.

One example of deceptive advertisements is that beneficiaries will get money back in their Social Security checks if they enroll in a Medicare Advantage plan.  But that benefit applies to an extremely limited number of people in certain zip codes.

Some plans may advertise that their "extra benefits" include rides to the doctor, dental coverage, hearing aids, and home meals. But after the beneficiary enrolls, they learn that only a small portion of those costs are covered, or they have to go to certain providers who aren't near their home, or that there are co-pays and deductibles.

Worst of all, are delays and denials of care through prior authorization requirements.  And also the loss of medical freedom, meaning that trusted and favored doctors, hospitals and even prescription drugs may not be covered.  Because they are not in the advantage plan system.

Here is a relevant experience.  Barry, a recently retired software executive, tells a cautionary tale.

When a gastric issue led the 65-year-old (his name has been changed to protect his privacy) to the hospital this summer, a CT and biopsy revealed pancreatic cancer. His oncologist came to his bedside to discuss next steps.

"We'll need to do a PET scan to see if the tumor is localized, and that will determine whether we should do chemo or surgery," he was told. With pancreatic cancer, the oncologist said, "the faster we move, the better."

But the oncologist frowned. Unfortunately, the scan couldn't be scheduled for 3 or 4 weeks.

"You're the Cleveland Clinic," Barry responded.

"We're not the problem," the oncologist replied. "We have to get approval from your insurance. We'll submit it, they'll reject it. There's a lot of back and forth."

Barry was puzzled. He had avoided signing up with an MA plan after his broker warned him that those enrollees often had to wait for prior authorization review, which delayed care for weeks to months.

"Just to be clear," he said, "I'm not in Medicare Advantage. I have regular Medicare with a supplemental."

The oncologist's whole demeanor changed. The frown became a smile. "Well then, we can go a lot faster," he was told. He got his PET study 3 days later. Barry said a 4-week wait would be intolerable. More importantly, he said, "The sooner I could begin, the less chance the tumor would have to grow or spread elsewhere and become much more difficult to treat."

Denial of physicians' referrals for care are a huge problem. Even after appeals and approval, there are delays in scheduling. It's a game that gobbles up huge amounts of staff time, clinicians complain. One physician said he expects all MA referral requests to be denied at least once.

Even when services are finally approved, some MA beneficiaries go to schedule their test or procedure and find it's nearly impossible, because the health care system is so overloaded.

Health outcomes are seriously threatened.

Sources here, here and here

Part 2

With beneficiaries rapidly joining MA plans by the millions each year, more than half of those eligible will be in MA plans rather than traditional medicare as soon as next year. By 2032, that number is projected to hit 61%, according to a Kaiser Family Foundation (KFF) analysis based on a Congressional Budget Office report.

This forecast is because so many elderly are wooed by ads promising low- or no-cost premiums, money added to their Social Security checks, free dentistry, home meals, prescriptions, and rides to the doctor. But those ads and marketing schemes don't tell the whole story. They are very misleading.

The goal in creating the MA concept in 1997 appeared to be a noble one. As of 1999, new Medicare+Choice plan patients would get all their care from providers who talked with each other and coordinated services, thereby reducing waste and overuse. While absorbing risk of taking on sicker patients, they'd be incentivized to use resources judiciously, thus reducing harm from unnecessary care, and cost the Medicare program much less.

But that's not how it's worked out.

According to a KFF report, in 2019, mdicare spent an average of $321 more for an MA enrollee than if that enrollee was in traditional Medicare. Multiply that by many millions of people.

Subsequent to a flurry of Congressional hearings earlier this year, CMS recognized a problem with MA plans and in April acknowledged a growing number of complaints, some 15,497 in 2020 and 39,617 in 2021, excluding December.

The goal in creating the MA concept in 1997 appeared to be a noble one. patients would get all their care from providers who talked with each other and coordinated services, thereby reducing waste and overuse. While absorbing risk of taking on sicker patients, they'd be incentivized to use resources judiciously, thus reducing harm from unnecessary care, and cost the Medicare program much less.

But that's not how it's worked out.

On August 1, the government asked for public input on some 46 potentially problematic aspects of MA plans. For example, it asked about the plans' "specific prior authorization and utilization management techniques." And on marketing, it asked, "How well do MA plans' marketing efforts inform beneficiaries about the details of a given plan?" with specific examples of effective or ineffective techniques.

In a 42-page response, the Center for Medicare Advocacy said while there are barriers in traditional Medicare, those barriers are worse for MA enrollees.

In a nutshell, its attorneys David Lipschutz and Kata Kertesz wrote, MA plans seem to work well for the young and healthy, but not so well for many who are not.

"This is a population that is falling through the cracks when it comes to accessing medically necessary care in MA plans." "Much more drastic changes are needed in order to adequately protect Medicare beneficiaries against an onslaught of overly aggressive and often misleading Medicare Advantage marketing performed by those who have significant financial stakes in steering people towards MA plans, regardless of whether such option is the best course for an individual," they wrote.

The New York Times did a story with the title: 'The Cash Monster Was Insatiable': How Insurers Exploited Medicare for Billions.”

Here are some excerpts.

“The health system Kaiser Permanente called doctors in during lunch and after work and urged them to add additional illnesses to the medical records of patients they hadn’t seen in weeks. Doctors who found enough new diagnoses could earn bottles of Champagne or a bonus in their paycheck.

Anthem, a large insurer now called Elevance Health, paid more to doctors who said their patients were sicker. And executives at UnitedHealth Group, the country’s largest insurer, told their workers to mine old medical records for more illnesses — and when they couldn’t find enough, sent them back to try again.

Each of the strategies — which were described by the Justice Department in lawsuits against the companies — led to diagnoses of serious diseases that might have never existed. But the diagnoses had a lucrative side effect: They let the insurers collect more money from the federal government’s Medicare Advantage program.

Medicare Advantage, a private-sector alternative to traditional Medicare, was designed by Congress two decades ago to encourage health insurers to find innovative ways to provide better care at lower cost. If trends hold, by next year, more than half of Medicare recipients will be in a private plan.

But a New York Times review of dozens of fraud lawsuits, inspector general audits and investigations by watchdogs shows how major health insurers exploited the program to inflate their profits by billions of dollars.

The government pays Medicare Advantage insurers a set amount for each person who enrolls, with higher rates for sicker patients. And the insurers, among the largest and most prosperous American companies, have developed elaborate systems to make their patients appear as sick as possible, often without providing additional treatment, according to the lawsuits.

As a result, a program devised to help lower health care spending has instead become substantially more costly than the traditional government program it was meant to improve.

Eight of the 10 biggest Medicare Advantage insurers — representing more than two-thirds of the market — have submitted inflated bills, according to the federal audits. And four of the five largest players — UnitedHealth, Humana, Elevance and Kaiser — have faced federal lawsuits alleging that efforts to overdiagnose their customers crossed the line into fraud.

The fifth company, CVS Health, which owns Aetna, told investors its practices were being investigated by the Department of Justice.

A study from the Kaiser Family Foundation, a research group unaffiliated with the insurer Kaiser, found the companies typically earn twice as much gross profit from their Medicare Advantage plans as from other types of insurance.

“Medicare Advantage is an important option for America’s seniors, but as Medicare Advantage adds more patients and spends billions of dollars of taxpayer money, aggressive oversight is needed,” said Sen. Charles Grassley, R-Iowa, who has investigated the industry. The efforts to make patients look sicker and other abuses of the program have “resulted in billions of dollars in improper payments,” he said.

Many of the fraud lawsuits were initially brought by former employees under a federal whistleblower law that allows them to get a percentage of any money repaid to the government if their suits prevail. But most have been joined by the Justice Department, a step the government takes only if it believes the fraud allegations have merit. Last year, the department’s civil division listed Medicare Advantage as one of its top areas of fraud recovery.

“The cash monster was insatiable,” said Dr. James Taylor, a former coding expert at Kaiser who is one of 10 whistleblowers to accuse the organization of fraud.

At meetings with supervisors, he was instructed to find additional conditions worth tens of millions of dollars. “It was an actual agenda item and how could we get this,” Taylor said.

Several experts, including Medicare’s advisory commission, have recommended reducing all the plans’ payments. Congress has ordered several rounds of cuts and gave CMS the power to make additional reductions if the plans continued to overbill. The agency has not exercised that power.”

Book Review:  https://heartlanddailynews.com/2021/03/author-there-is-a-solution-to-covid-but-government-wont-tell-you/ 

Amazon review from UK:  Written without babbling and unnecessary information. It is all too easy for a lay person to get bogged down in data but this is written concisely and packed full of up to date information.  A must read for anyone mistrusting of governments guidelines, misinformation and scaremongering. Excellent.