Monday, March 25, 2024

Medicare Advantage gets walloped in the press as the federal government's rate notice looms - Mar. 25, 2024

 

https://wendellpotter.substack.com/p/medicare-advantage-gets-walloped

Medicare Advantage gets walloped in the press as the federal government's rate notice looms

Wendell Potter
Mar 25, 2024

In the next week or so, the federal government will announce a decision that will clue us in on whether big health insurers that run the private Medicare Advantage program will have once again succeeded in browbeating regulators into giving them billions more of our money than they’re lawfully entitled to. 

This is the time of year when the Center for Medicare and Medicaid Services makes a final decision on how much of an increase to send to private insurers that now control access to care for more than half of all Medicare beneficiaries. In past years, private insurers’ intense lobbying and intimidation have paid off–to Wall Street’s delight.

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That’s largely because consumer and patient advocacy groups and the media have not paid close enough attention to what has become the biggest source of revenue and profits for many of the country's biggest corporations.

But this year is different, and you’ll see some of the evidence below. 

Here’s what’s happening:

At the end of January, CMS released its “Advance Notice” of proposed payment rates and policy changes for health plans that participate in Medicare Advantage in 2025. The calculations CMS uses are complicated but the bottom line is that the agency proposed a 3.7% average expected increase in revenue for MA plans next year. You can find a good analysis of what’s going on and what’s at stake in last Wednesday’s edition of Health Affairs, written by a team of researchers at Brown University and Georgia State. 

Health plans are insisting, as they did last year and in years past, that what CMS is proposing would actually result in a pay cut, and they warn that it would force them to increase premiums, cut benefits, or both. Usually, the back and forth stays inside the beltway, but last year the fight spilled over into prime time when the industry-funded Better Medicare Alliance spent a fortune on a Super Bowl ad that asked viewers to “tell the White House” not to “cut” Medicare Advantage. 

The Brown and Georgia State researchers set the record straight and, in somewhat restrained academic prose, called BS on the industry:

Indeed, although MA plans and their lobbying organizations have portrayed these proposed payment updates as major cuts, this is not true. To put the 2025 MA rate changes in perspective, the 3.7% increase in revenue is larger than last year’s 1% predicted increase but smaller than previous years’ increases exceeding 7% annually. The extremely high margins made by MA plans will barely be touched by provisions in the Advance Notice. (Emphasis added.)

STAT News’ Bob Herman, was more direct in his reliably engaging newsletter this morning:

Within the next week, we will know how the Biden Administration is approaching next year’s Medicare Advantage plans–and whether it is willing to meet the health insurance industry’s demands and deposit more money into the bank accounts of insurers…Billions of dollars are on the line for a program that still has not saved a dime for taxpayers, despite promises that it would. 

Having been a part of the industry’s propaganda machine, I know how insurers swing into action at the slightest perceived threat to Medicare Advantage profit margins. For years, we organized and financed what we called “granny fly-ins” to Washington to get “regular seniors” to fan out across Capitol Hill to deliver the industry’s talking points directly to members of Congress. We helped thousands of others who couldn’t make the trip to write letters to the President and lawmakers expressing outrage at the very notion of putting insurers’ fattest cash cow on a diet. 

As Herman noted this morning, 42,000 comments have flooded into the federal government on this issue in the weeks since CMS released its Advance Notice.

What has changed this year, though, is that many of those comments are from real people and real organizations representing them, like Public Citizen, the Center for Medicare Advocacy, People’s Action, Be a Hero and many others that have come together to push back against the industry’s tactics and lies. In recent weeks, they’ve landed high-level meetings with Biden Administration officials and members of Congress and have made it clear that they won’t be happy if CMS caves once again to industry pressure. 

In addition, the media is waking up and calling foul on Medicare Advantage. I wouldn’t think of writing this without giving a big shout-out to Fred Schulte at KFF News (and previously at the Center for Public Integrity, where Fred and I were colleagues a decade ago). Fred was among the few in the media at the time whose investigative reporting laid bare the industry’s blatant “money grab.” If you care about how your tax dollars have been used to enrich a few executives and shareholders, you should check out Fred’s series of reports from 2014 to 2017.  

But it would take The New York Times’ Reed Abelson and Margo Sanger-Katz to make the money grab a hot topic in DC and the rest of the media. The headline of their October 22, 2022, front-page story was compelling, to say the least: 

‘The Cash Monster Was Insatiable’” How Insurers Exploited Medicare for Billions. By next year, half of Medicare beneficiaries will have a private Medicare Advantage plan. Most large insurers in the program have been accused in court of fraud.

In the months after that seminal story, dozens of reporters have turned their attention to Medicare Advantage. My team and I have seen most of them and have brought many of them to your attention. But in case you might have missed them, we’ve provided links to a few we think you ought to see. After you read them, we encourage you to “call the White House.”

Here’s a small sampling of some of the stories and commentaries you might have missed:

March 2023

April 2023

May 2023

June 2023

July 2023

August 2023

September 2023

October 2023

November 2023

December 2023

January 2024

February 2024

March 2024

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