I have been hitting the issues with FFS Medicare vs Medicare Advantage hard. Primarily, Medicare Advantage is draining Medicare funding due to the $billions being spent due to over-coding. Twelve $billion of over-coding charges in 2020. Another billion of over-coding charges in 2021. CEOs are raking in higher salaries due to the preferential treatment the Medicare Advantage plans receive from Congress and CMS. Over-coding is just one of the issues. Senate Dems Blast Medicare Advantage Giants Over ‘Exorbitant’ CEO Pay, (commondreams.org), Jake Johnson Sens. Elizabeth Warren and Jeff Merkley are calling attention to the massive profits and “exorbitant” executive salaries of top Medicare Advantage insurers such as UnitedHealthcare and Humana,
Topics:
run75441 considers the following as important: Healthcare, Medicare Advantage, politics, US EConomics
This could be interesting, too:
Robert Skidelsky writes Speech in the House of Lords – Autumn Budget 2024
Merijn T. Knibbe writes Völkermord in Gaza. Two million deaths are in the cards.
Peter Radford writes Who brought us Trump?
NewDealdemocrat writes Real GDP for Q3 nicely positive, but long leading components mediocre to negative for the second quarter in a row
I have been hitting the issues with FFS Medicare vs Medicare Advantage hard. Primarily, Medicare Advantage is draining Medicare funding due to the $billions being spent due to over-coding. Twelve $billion of over-coding charges in 2020. Another $15 billion of over-coding charges in 2021. CEOs are raking in higher salaries due to the preferential treatment the Medicare Advantage plans receive from Congress and CMS. Over-coding is just one of the issues.
Senate Dems Blast Medicare Advantage Giants Over ‘Exorbitant’ CEO Pay, (commondreams.org), Jake Johnson
Sens. Elizabeth Warren and Jeff Merkley are calling attention to the massive profits and “exorbitant” executive salaries of top Medicare Advantage insurers such as UnitedHealthcare and Humana, which are leading a lobbying blitz against efforts to combat widespread fraud in the privately run healthcare program. It is an easy read, not to complex, and it gets to the point.
“In 2022, the seven major Medicare Advantage health care insurers, United Healthcare, CVS/Aetna, Cigna, Elevance Health, Humana, Centene, and Molina brought in revenues of $1.25 trillion. Equally impressive is their reporting total profits of $69.3 billion, a 287% increase in profits since 2012.”
Democratic senators wrote the details in recent letters to the companies’ CEOs, citing an analysis by Wendell Potter of the Center for Health and Democracy.
“But rather than investing in benefits for patients,” they added, “these seven health insurers instead spent $26.2 billion on stock buybacks.”
AB: To put this into perspective. In 2020 and reported in Chapter 12, page 439 of the 2022 MedPac report. “Coding differences increased payments to MA plans by $12 billion in 2020.” And this is just one year. I am sure all the big-wig CEOs and Board Chair People were trembling in their chairs. They were scared so much Congress gave them three years to adjust to Congressional demands. Meanwhile, we are footing the bill.
Warren (D-Mass.) and Merkley (D-Ore.) also highlighted the “extraordinary salaries” of the insurance giants’ CEOs and other top executives. Brian Thompson, who became UnitedHealthcare’s CEO in 2021, brought home nearly $10 million in total compensation that year, according to SEC filings.
Humana chief executive Bruce Broussard raked in more than $17 million in 2021.
The letters were sent Wednesday as the insurance industry continues to ramp up its attacks on Biden administration proposals aimed at reining in upcoding and other tactics that Medicare Advantage plans use to reap larger payments from the federal government, which funds the program.
Critics of Medicare Advantage argue such overpayments, topping $15 billion in fiscal year 2021 alone, are “depleting the Medicare Trust Fund” at the expense of patients. The same patients who are frequently denied medically necessary care.
AB: Hmmm, Twelve $billion of over-payments in 2020 and $15 billion in 2021. Approximately half of Medicare is funded by taxes outside of the Medicare tax.
“MA plans are consistently paid more for seniors’ care,” Warren and Merkley noted, “and MedPAC projects that total Medicare payments to MA plans in 2023 will be $27 billion higher than if MA beneficiaries were enrolled in traditional Medicare.”
“Rather than investing in benefits for patients, these seven health insurers instead spent $26.2 billion on stock buybacks.”
Even though the Biden administration’s proposed reforms would still leave Medicare Advantage plans with payments that are around 1% higher per enrollee in 2024 compared to this year, the insurance industry has characterized the changes as a cut and warned that their implementation would lead to higher premiums and worse care for beneficiaries.
AB: Higher premiums and worse care for beneficiaries? I am hoping someone got this wrong and they really did not say this.
In their letters, Warren and Merkley accused the for-profit insurance industry of attempting “to scare seniors and people with disabilities into opposing changes that will reduce waste, fraud, and abuse” in Medicare Advantage.
As The New York Times reported earlier this week, “Medicare officials have been inundated with more than 15,000 comment letters for and against the policies, and roughly two-thirds included identical phrases from form letters.”
“Insurers used television commercials and other strategies to urge Medicare Advantage customers to contact their lawmakers,” the Times added. “The effort generated about 142,000 calls or letters to protest the changes, according to the Better Medicare Alliance, one of the lobbying groups involved.”
That group—which counts Aetna, Humana, and other insurance giants as “ally organizations“—purchased a Super Bowl ad urging the White House not to “cut” Medicare Advantage:
Warren and Merkley voiced outrage that Medicare Advantage insurers would respond to the Biden administration’s proposed policy changes by threatening “actions that hurt seniors“—such as premium hikes—”instead of reducing exorbitant salaries or the massive payouts to your shareholders and executives.”
“It is outrageous that industry groups, on your behalf, are putting your plan’s enormous profits “in their pockets” over care for seniors,” the senators wrote to the insurance company CEOs.
What is outrageous? The Medicare Advantage Corporations have been over coding for years. CMS has not had the backbone to call them to the table and force them into compliance. Each year Medicare Advantage plans underbid on the next year’s care. CMC plans a payment a percentage over their bids for each patient. When the care is administered, they over code. Or they may deny care or delay care.
Reference Material
Medicare Advantage has Overcharged FFS Medicare by Billions for Years, Angry Bear, angry bear blog
Aggregate Medicare payments to Medicare Advantage plans, Angry Bear, angry bear blog
Why is CMS Overpaying Medicare Advantage Plans? Angry Bear, angry bear blog
Medicare Advantage and Medicare Issues, Angry Bear, angry bear blog*
Medicare Part C Improper Payment Measurement (IPM), CMS
Error Rate Findings and Results, CMS
High-Priority Programs, paymentaccuracy.gov
Taking Stock of Medicare Advantage: Risk Adjustment, Commonwealth Fund