“Senator, Saying It Doesn't Make It True”

How a Biden administration official refused to be baited by a senator’s Medicare Advantage talking points.

The health insurance industry maintains a list of reliable go-to members of Congress to call on when profit margins are in danger of being squeezed by a new bill or some government action. As I wrote a few days ago, the insurance lobby relied on the late Sen. Joe Lieberman (I-Connecticut) to kill the public option in 2010 by a one-vote margin. Insurers just needed one man to cast a single vote to enable them to make massive profits for years to come. 

It became clear this week that the industry has a new Joe Lieberman: Sen. John Kennedy (R-Louisiana). 

During a Senate Appropriations Committee hearing on President Biden’s proposed budget Wednesday, Kennedy tried to get Health and Human Services Secretary Xavier Becerra to say the Biden administration had cut payments to health insurers that sell private Medicare replacement plans marketed as Medicare Advantage. It isn’t true, but two big industry PR and lobbying groups–AHIP and the Better Medicare Alliance–have characterized the recently announced rate increase for MA plans next year as a cut. It’s just not as much of an increase as the industry had hoped. 

One of the industry’s talking points is that Medicare Advantage saves seniors enrolled in those corporate-run plans an average of $2,400 a year.  Kennedy cited that number in his grilling of Becerra, trying to get him to say not only that the number was accurate but that it also was a number his own department had come up with. 

I remembered seeing that number somewhere before, so I looked up its origin. As it turns out, it’s a figure that came out of “research” commissioned a year ago by none other than the Better Medicare Alliance. Both AHIP and BMA have been throwing that number around in Washington ever since. 

During my career in the insurance business, my colleagues and I would often pay for research designed to “prove” one thing or another, and we knew how to spin it and get it into public consciousness and the political arena. We succeeded, for example, in persuading lawmakers and employers that Americans were chomping at the bit to enroll in health plans with high deductibles. We called them “consumer-driven health plans” to imply that people would “take more responsibility” for their care if they had to pay more for it out of their own pockets. We trotted out numerous flawed surveys to make the case. 

It worked brilliantly. Today families with insurance can be forced to drain nearly $19,000 from their bank accounts every year to pay for medical expenses before their insurance kicks in. And big insurers like UnitedHealth Group are making billions of dollars in profits every month because they don’t have to pay nearly as many claims as they would have before the industry-backed consumer-driven “movement” got underway, thanks largely to bogus research. 

To his credit, Becerra pushed back time and again against Kennedy’s misleading and often outright false talking points, which undoubtedly were handed to him by my former colleagues. 

To see how politicians carry water for Big Insurance, take a look at the transcript below of the Kennedy-Becerra exchange. Note that Kennedy made no mention of another, more credible number about Medicare Advantage from the Medicare Advisory Payment and Advisory Commission (MedPAC): $88 billion. That’s the amount of overpayments Medicare Advantage corporations will be getting from taxpayers this year. 

Here is a transcript of the back and forth between Becerra and Kennedy:

Sen. John Kennedy (R-LA):
Why is Medicare Advantage so popular? About half of our seniors who qualify for Medicare, choose Medicare Advantage, don’t they?

Mr. Becerra:
It’s actually more than half.

Sen. John Kennedy (R-LA):
Why is that? What makes it popular?

Mr. Becerra:
This is the first year we’ve seen more individual elect plans in the Medicare Advantage program.

Sen. John Kennedy (R-LA):
Why is it popular?

Mr. Becerra:
When you say popular, I’m not sure what you mean. I've heard many Medicare beneficiaries who are complaining about being stuck at a Medicare Advantage plan.

Sen. John Kennedy (R-LA):
Well, is it, is it because the average senior on Medicare Advantage pays $2,400 less in premiums on Medicare Advantage as opposed to traditional Medicare and gets more services like dental and vision. Could that have something to do with it, you think?

Mr. Becerra:
I'm assuming that you've seen some polling or surveys that give you some of those answers. I've heard many, many things good or bad about Medicare.

Sen. John Kennedy (R-LA):
I’ve seen the facts. Are you telling me that people on Medicare Advantage don't save money in premiums and copays over traditional Medicare?

Mr. Becerra:
I doubt that some do that, but I have no doubt that some pay more.

Sen. John Kennedy (R-LA):
I'm talking about the average.

Mr. Becerra:
Again, I don't know what numbers you're referring to, but I'm more than willing to look at those with you.

Sen. John Kennedy (R-LA):
I'm looking at the numbers your department puts out.

Mr. Becerra:
Okay, then what are those numbers, Senator? 

Sen. John Kennedy (R-LA):
The numbers say that the average person on Medicare Advantage pays $2,400 less in premiums in copays and gets extra benefits. Is that right?

Mr. Becerra:
My understanding is they're also restricted in the doctors and hospitals they have access to.

Sen. John Kennedy (R-LA):
You're trying to destroy Medicare Advantage, aren't you?

Mr. Becerra:
No. We've actually provided an increase in funding for Medicare Advantage.

Sen. John Kennedy (R-LA):
No you haven't. You cut funding in 2023 by 1.1%.

Mr. Becerra:
That's absolutely incorrect.

Sen. John Kennedy (R-LA):
Next year you're proposing a 0.16% cut.

Mr. Becerra:
That's absolutely incorrect.

Sen. John Kennedy (R-LA):
That's, that's not incorrect. The Medicare trustees said that you've lost your mind. My words not theirs.

Mr. Becerra:
Senator, saying it doesn't make it true. The dollar amount that we are giving to health insurance companies has increased.

Sen. John Kennedy (R-LA):
You have cut Medicare Advantage. Are you telling me today that you have not cut payments to insurers in Medicare Advantage last year By 1.1%?

Mr. Becerra:
Health insurance companies under Medicare Advantage are receiving more money this year than they got last year for Medicare.

Sen. John Kennedy (R-LA):
You cut them by 1.1%.

Mr. Becerra:
That's not a cut, Senator.

Sen. John Kennedy (R-LA):
And you're proposing another 0.1% cut. In fact, you and President Biden say you, you will not touch a hair on the head of Medicare, but you're trying to destroy Medicare Advantage.

Mr. Becerra:
Actually, the President's budget extends the life of Medicare beyond your and my lifetime.

Sen. John Kennedy (R-LA):
Look at the numbers. In 2023, under your watch, Medicare Advantage patients saw on average a 12% increase in deductibles and a 5% increase in premiums.

Mr. Becerra:
The insurance companies did that, not us.

Sen. John Kennedy (R-LA):
Florida and Utah and Wyoming saw their premiums go up 50% because you cut the payments to the insurance companies. to drive them to traditional Medicare where you can control them better. Isn't that the case?

Mr. Becerra:
Blame the insurance companies, not us. We did not cut insurance. The fiction you’re saying doesn’t resolve the issue that we have every year. So far this administration has increased the funding for health insurance companies who offer these Medicare Advantage plans.