Medicare Advantage Insurers Hurt You Because Their Profits Depend On It
Physicians for a National Health Program estimate nearly 12 million seniors are in a Medicare Advantage plan that excludes more than 70% of doctors in their county.
Negative stories about Medicare Advantage (MA) insurers are finally making it to mainstream media after percolating below the surface for years. More and more patients, physicians, and even health care executives are speaking up about the disastrous expansion of this program. Shockingly, some of these stories have come from the insurance companies themselves.
With no hint of shame or irony, executives like CFO Thomas Cowhey of CVS Health have delivered lines such as “The goal next year is margin over membership,” making explicit that more money is their mantra. With all these reports of limited networks, care denials, delayed payments, and corporate greed, you may feel like the story of MA can’t get any worse.
Impossibly, it does. Physicians for a National Health Program (PNHP) has just recently released a bombshell report exposing the sheer breadth of harm that MA insurers have done to patients and health care workers across the country. The report combines policy analysis of dozens of academic studies, news reports, and government investigations with personal stories from people hurt by the insurance companies running these plans. We want to take some time to explore the report’s findings, and highly encourage you to read it in full as well.
Patients in MA experience difficulties from the moment they begin to seek care. By PNHP’s estimate, 11.7 million beneficiaries are in a plan that excludes more than 70% of doctors in their county. These narrow networks mean that patients often have to travel hours for an appointment, and can’t see their preferred family physician or the right specialist for their condition. This can have dire consequences.
One study found that cancer patients in MA are less likely to be treated at teaching hospitals, Commission on Cancer-accredited hospitals, or National Cancer Institute-designated centers. As a result, these patients suffer higher mortality rates following surgery for a number of kinds of cancer, with some cancer patients in MA plans being twice as likely to die as those in traditional Medicare. Put simply, narrow networks designed to reap profits in MA are killing patients.
Even if they’re able to find the right doctor, getting care doesn’t become any easier. MA insurers almost always require prior authorization for standard, evidence-based tests, procedures, and treatments, making patients wait weeks or even months to get the life-saving care they need now. In one story from the report, a physician recounts how damaging this practice can be:
I had a patient with several chronic diseases who was very sick and had just survived major abdominal surgery, almost miraculously. In the aftermath, she desperately needed to go to acute rehab, which is the most intensive rehab – we found a facility, she liked it, her family liked it, and then her MA plan looked at the place and said ‘No, she’s healthy enough to not go to acute rehab, we won’t authorize it.’ This was after our PM&R specialist, physical therapist, and 3 MDs on our team had told her she needed acute rehab, and that it was the only thing that would keep her out of the hospital again. And this insurer, without anyone ever looking at her, rejected that conclusion. And we knew that on traditional Medicare this never would’ve happened.
Prior authorization is also a gigantic waste of time and resources for doctors and health care workers who want to spend that time caring for patients. PNHP found that medical practices are forced to waste between 11.1 and 20.5 million hours per year filling out authorization forms and fighting with insurance companies to get necessary care approved.
Much of this is done arbitrarily, wearing patients down with bureaucracy so the insurance company doesn’t have to pay for treatment. When challenged on appeal, somewhere around 80% of denials are reversed, proving there was no good medical reason for the denial in the first place.
Assuming you can find a doctor in your narrow network, and that your doctor makes it through the red-tape nightmare to get your necessary care approved, you may then find yourself dealing with severely limited coverage and thousands of dollars in medical bills. In fact, 7.3 million beneficiaries in MA are considered underinsured based on their reporting of high health care costs. Seniors and people with disabilities are often enticed into MA by advertisements or insurance brokers who tout low premiums and supplemental benefits as big perks of their plans, only to find that once they actually become sick, coverage dries up fast.
After experiencing all of these hardships, many beneficiaries find themselves wanting to get out of MA and go to traditional Medicare, and studies show that those who are seriously ill or who have high health care costs indeed switch out of the program at high rates. Unfortunately, if you stay in MA too long, you may be trapped in the program for good.
For the first twelve months someone is in MA, they have a guarantee that no Medigap insurer can deny them a policy. However, once this period is up, this guarantee disappears in 46 of 50 states. If you decide to switch back to traditional Medicare after a year, you are no longer guaranteed to receive this coverage, and you can be denied a policy on the basis of “pre-existing conditions,” a practice that most believe was fully outlawed following the passage of the Affordable Care Act.
Imagine you get sick while in MA, and rack up thousands of dollars in medical bills that you can’t pay. When you try to switch to traditional Medicare, you can be denied Medigap coverage because of the very illness that made you need to leave MA. Many people simply cannot afford Medicare without Medigap, meaning their only option is to stay in their MA plan.
If all of this seems crazy, that’s because it is. Medicare Advantage is a total rejection of the founding principles of Medicare and health care in general, and every harmful practice in this report is done in the name of profit. Restricting networks, denying care, refusing to cover costs–these are all ways that insurance companies in MA keep our taxpayer dollars while leaving patients and health care workers to deal with the consequences. We need to work together to get these greedy middlemen out of Medicare before they take it over entirely. Our hard-earned dollars should be going toward making traditional Medicare, the program that actually serves its constituents, more affordable and accessible.
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As an RN this makes me sick
End stage capitalism has past. I have named the new ism “Scumunism.” Health care will worsen then become your financial responsibility.
I have many anecdotal stories about our disease care system failures. I won’t bore you.
Climate Collapse will be coopted and sold as “God’s Revenge” for “name it.” No matter that He aborted, by drowning, the fetuses of EVERY pregnant woman on earth and killed everyone in the Great Flood. (Not to mention Hosea 13:16.). No health care was needed.
B.S. Economics, retired founder and Corporate President of an international manufacturing company.