Medicare Advantage, through the risk-adjusted model, receives government payments on a fixed per-patient basis, also known as “capitation.” They are supposed to earn profits by lowering system costs under that capitated rate. Medicare is a “fee-for-service” operation that pays providers about 80 percent of most treatments that leaves large co-payments for seniors, and sends most looking for supplemental coverage. Medicare is administered by the federal government Medicare Advantage, by private insurance plans. “There are very few people who even understand the difference between Medicare and Medicare Advantage, or how Medicare Advantage works,” Archer told the Prospect. That should tell you how powerful this industry has been historically.ĭIANE ARCHER, PRESIDENT OF JUST CARE USA, first started raising alarms about Medicare Advantage in the early 1990s. Yet advocates who have spent decades fighting Medicare Advantage’s dominance are taking it as a kind of victory. This all sounds terrible: Industry pushback cowed a well-intentioned effort to prevent Medicare Advantage fraud and protect patient lives. Thousands of insured seniors die annually from lack of health care access, according to a National Bureau of Economic Research study, in large part because of these practices.Īn electronic billboard sponsored by Coalition for Medicare Choices at Washington’s Union Station Loosely translated, this means that the industry insisted they couldn’t survive without ripping off the government, so the government allowed the rip-offs to go on a bit longer.Ī separate final rule on Medicare Advantage prior authorization policies, which can delay or deny needed care, offers no public transparency on which plans rely on prior authorization the most, nor does it threaten the contracts of plans with bad records. Next year, Medicare Advantage plans will get a 3.3 percent increase in their reimbursement rates, more than triple the 1 percent CMS initially proposed.ĬMS administrator Chiquita Brooks-LaSure actually told The New York Times that the agency “wanted to be responsive” to insurer demands for a slower policy rollout. Instead of implementing the new formula and coding changes immediately, payments would be gradually reduced over three years, and the codes most susceptible to manipulation also phased out slowly. Two months later, CMS issued its final payment rate rule. Thousands of codes that do not require additional care would be eliminated, and reimbursement rates would be lowered. The proposal attacked “ upcoding,” where companies layer on multiple dubious or irrelevant diagnoses to rake in risk-adjusted payments that give more to insurers who care for sicker patients. On February 1, the Centers for Medicare & Medicaid Services (CMS) proposed changes to Medicare Advantage, specifically to curb fraudulent and systematic overbilling costing the government tens of billions of dollars, as well as rampant denials in coverage. Sure enough, it worked this year yet again. This has almost always produced industry-favored results. Since the famed “Harry and Louise” ads that helped sink Hillarycare in the 1990s, the insurance industry has a playbook for whenever Washington threatens its profit model: depict it as a scheme from Washington bureaucrats to hurt your health care. The groups unleashed thousands of comments to regulators and members of Congress, often with identical language taken from a form letter. Better Medicare Alliance’s membership includes Medicare Advantage insurers Aetna, Humana, and UnitedHealth, whose CEO personally lobbied lawmakers in Washington.īetter Medicare Alliance spent over $13.5 million on its ad campaign, while the American Action Network, a dark-money group backed by pharma money, piled on with $2 million in ads of its own. Despite billing itself as a grassroots organization with two million members, the Coalition for Medicare Choices was founded in 2009 out of the same offices as America’s Health Insurance Plans (AHIP), a leading industry lobbying group.Īnd if you watched this year’s Super Bowl, you might have seen an ad from the Better Medicare Alliance, “the leading voice for Medicare Advantage,” featuring seniors bowling while fretting about Medicare Advantage cuts. It features two worried-looking seniors warning against cuts to Medicare Advantage, the privately administered insurance program that covers nearly 30 million U.S. If you visited Washington’s Union Station in the past month and checked the monitor listing train departure times, you would be unable to miss the large billboard behind it, from an organization called the Coalition for Medicare Choices.
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