Gainesville, Florida (Special to Informed Comment) – Award winning journalist,Trudy Lieberman, a former president of the Association of Health Care Journalists, alerts us that it is now “open-enrollment season – the yearly grand bazaar when insurers and agents for them hawk Medicare Advantage plans – which just opened for coverage starting January 1, 2026. Lieberman cautions that If the past is any indication, sellers working for insurance companies, some with household names, others not, will snare new recruits into Medicare Advantage plans, possibly omitting in their sales pitches that they will be locked into an MA plan and could face great difficulty returning to traditional Medicare and buying a supplement policy if things go wrong – as they often do. Insurers will once again flood seniors with “free” Medicare Advantage goodies and offers. Lieberman concludes that “consumer protections, like those enacted by Congress to address Medigap marketing practices years ago, are urgently needed.”
WHAT IS MEDICARE ADVANTAGE?
Medicare Advantage is a private profit program offering private health insurance industry plans as options to replace public traditional Medicare. Medicare Advantage plans differ from traditional Medicare in that they are paid with capitation (per member), they are required to limit enrollees’ out-of-pocket spending, and can offer extra benefits (e.g. gym memberships, $900 worth of groceries, dental benefits). They almost always offer prescription drug coverage and use a defined and often restricted network of providers that can require enrollees to pay more for out-of-network care. Managed Care/Utilization management techniques are used, such as prior authorization, and they can also fund special programs such as rewards for beneficiaries to encourage “healthy behaviors”. In reality, “Medicare Dis-Advantage” is a better, more accurate name for the programs however, as insurance companies push Congress to corporatize all of Medicare, yet keep the name for the purposes of marketing, deception, and confusion.
HOW DO MEDICARE ADVANTAGE PLANS DIFFER FROM TRADITIONAL MEDICARE?
* MA plans are owned and operated by for-profit, private insurance corporations and Wall Street investors.
* Unlike traditional Medicare, Medicare Advantage plans often refuse to pay for treatments and medications physicians prescribe.
* Unlike traditional Medicare, many physicians, other healthcare professionals and hospitals will be off-limits to patients because Medicare Advantage companies create their own proprietary and often skimpy, managed care type “networks” of healthcare providers.
* If patients go out of network, they could then be on the hook for thousands of dollars out of their own pocket.
* Patients do not have free choice of their professionals and health care institutions. Medicare Advantage does not allow choices within the entire health care system.
* They likely will have to pay extra—often a lot extra—for some of those extra benefits.
BURGEONING PROFITS IN PRIVATE HEALTH INSURANCE INDUSTRY:
Health advocate Wendall Potter found that the seven biggest publicly traded health insurance companies collectively made $71.3 billion in profits, up more than half a billion dollars from 2023. Huge strides in privatizing both Medicare and Medicaid have been made. More than 90% of health-plan revenues at three of the health industry companies come from government programs as they continue to privatize both Medicare and Medicaid, through Medicare Advantage in particular. Enrollment in government-funded programs increased by 261% in 10 years.
What has changed dramatically over the decade is that the big insurers are now getting far more of their revenues from Medicare, Medicaid and from taxpayers as they have moved aggressively into government programs. This is especially true of Humana, Centene, and Molina, which now get, respectively, 85%, 88%, and 94% of their health-plan revenues from government programs.
For-profit private health insurance now controls more than 70% of the Medicare Advantage market.
In 2022, Big Insurance revenues reached $1.25 trillion and profits soared to $69.3 billion.That’s a 300% increase in revenue and a 287% increase in profits from 2012, when revenue was $412.9 billion and profits were $24 billion.
BENEFICIARIES INUNDATED WITH AGGRESSIVE, MISLEADING AND OFTEN INTENTIONALLY DECEPTIVE SALES AND ADVERTISING PRACTICES OF MEDICARE ADVANTAGE PLANS:
With so much money to be made in Medicare Advantage (MA), it’s not surprising that The Centers for Medicare and Medicaid Services (CMS) revealed that the number of Medicare beneficiary complaints about private sector marketing for Medicare Advantage (MA) plans more than doubled from 2020 to 2021. Senator Ron Wyden’s Senate Finance Committee Majority Staff launched an inquiry in August 2022, collected information on marketing complaints from 14 states and found evidence that beneficiaries are being inundated with aggressive marketing tactics as well as false and misleading information.Investigation shows a toxic pattern of false, misleading advertisements and fraudulent sales practices that go well beyond isolated incidents. Reports from state insurance departments and SHIPs confirm that vulnerable seniors are being flooded by plans utilizing subsidiaries, third-party organizations, and “bait-and-switch” tactics that evade existing Medicare rules on plan marketing and communications to beneficiaries. Unscrupulous actors appear to be taking advantage of the loosening of marketing regulations, which has ratcheted up confusion and pressure on beneficiaries as well as enrollment into different plans.
PROFILES OF DECEPTION:
Each one of these profiles represents documented instances of aggressive or deceptive MA and Part D marketing practices that was found to be widespread, not isolated events:
*** Seniors shopping at their local grocery store are approached by insurance agents and asked to switch their Medicare coverage or MA plan.
*** Insurance agents selling new MA plans tell seniors that their doctors are covered by the new plans. Seniors who switch plans find out months later that their doctor is actually out-of-network, and they have to pay out-of-pocket to visit their doctor.
*** Seniors receive mailers that look like official business from a Federal agency, yet the mailer is a marketing prompt from an MA plan or its agent or broker.
*** An insurance agent calls seniors 20 times a day, attempting to convince them to switch their Medicare coverage.
*** Widespread television advertisements with celebrities, (e.g. Wm. Shatner, Danny Glover and others) claim that seniors are missing out on benefits, including higher Social Security payments, in order to prompt seniors to call MA plan agent or broker hotlines.
EXAMPLES FROM “DECEPTIVE MARKETING PRACTICES FLOURISH IN MEDICARE ADVANTAGE”:
A Report by the Majority Staff of the U.S. Senate Committee on Finance, Chairman Ron Wyden, D-OR.
https://www.finance.senate.go
1). Fake “IRS Mailers” and “Official Mailers”:
Mailers are designed to look like official notices coming from the Internal Revenue Service (IRS) or the Medicare Program. These mailers are both misleading and serve an important role in lead generation that allow TPMOs to get around many of the marketing prohibitions currently in law, per Section 103 of the Medicare Improvement for Patient and Providers Act (MIPPA) of 2008 that prohibits MA and Part D plans from conducting certain marketing activities, including cold calling. These mailers allow salesmen to skirt the rules because after the beneficiary initiates contact in response to an advertisement these prohibitions are no longer in place per CMS rules. Mailers framed as urgent that look like official notices from the IRS or other government entities serve the explicitly misleading purpose of prompting beneficiaries to “initiate contact,” so that MA marketing prohibitions can be circumvented. This loophole allows bad actors to inundate older Americans with unsolicited calls and other aggressive marketing.
2). Misleading Information about Provider Networks:
False or misleading claims around in-network and out-of-network providers were reported and are of high concern because they have serious impacts on beneficiary health. In response to the March 2022 Advance Notice released by CMS, the National Organization for Rheumatology Management (NORM) submitted a letter describing the provision of incorrect information about MA plan provider networks. In its letter to CMS, NORM reported that “When researching MA plan options, beneficiaries are often told by MA plan enrollment representatives that there will be no disruption in their treatment, and they can continue seeing their current care providers. Some beneficiaries will contact their rheumatology practice for confirmation. The practice administrator can share whether the treating rheumatologist is “in-network,” whether the prescribed medications are on the plan’s formulary and/or subject to prior authorization or step therapy, or whether the patient would need to be “switched” to another option, as well as what their expected out-of-pocket costs would be, if they proceed with MA plan enrollment. Far too often, beneficiaries learn the information shared by the MA plan representative was incorrect.” The letter goes on to say, “practice administrators learn of a patient’s change in coverage at the time the patient requests an appointment (and the practice does not participate in the plan) or visits the pharmacy to request a refill (and learns they either need prior authorization or the medication is now cost-prohibitive). At that time, the damage has been done, as the patient is “stuck” with the new MA plan until the next open enrollment period…. In these situations, the patient’s care is severely disrupted solely as a result of misleading marketing tactics used by the plan to increase enrollment.”
3). The Missouri Department of Insurance detailed similar beneficiary stories in a letter stating:“A 94-year-old woman with dementia was sold a MA plan. The consumer lives in a rural area, and the hospital and providers she utilizes are not in-network with the plan chosen for her by the insurance salesperson. The plan did not allow for continuity of care for the consumer and forced her to obtain care (with the help of staff) miles away from her residence.”
4). Television/Internet:
Another example of misleading marketing is the Medicare Coverage Helpline television advertisement campaign, which first aired in 2018 and features former football star Broadway Joe Namath. In the ad, Mr. Namath says, “get what you deserve,” and “the benefit that adds money back to your Social Security check.” After numerous lawsuits, the ad was recently updated to comply with current CMS regulations. However, it still fails to mention basic information about the MA program, including that not all providers are in-network and was only recently updated to mention that benefits vary by zip code.
See YouTube video: Medicare Advantage: Last Week Tonight with John Oliver (HBO)
5). Television advertisements can be particularly effective at targeting Medicare beneficiaries. For example, the Missouri Department of Commerce and Insurance reported instances of consumers “reaching out to insurance agencies after seeing a television advertisement. For example, an elderly consumer in a long-term care facility and without the capacity to make her own decisions, called the number advertised on television. During the call she was switched from one plan to another.”
6). Oregon reported a case where a dual eligible Medicare beneficiary and Social Security Income recipient was enrolled in a plan without prescription drug coverage. The beneficiary reported that they “did not remember making any changes to his coverage; however, remembered seeing a TV advertisement and called about it. He said the plan representative mentioned getting $135 more in his Social Security check ([the beneficiary] wasn’t sure what that meant but it sounded good). [The beneficiary] already had the State of Oregon paying his Part B premium. [The beneficiary] was told he would have a gym membership and dental coverage (which he already has dental through his Medicaid benefit). The key issue is that he was not told by the MA-only plan phone agent that the plan does not cover Rx and does not include Part D.”
IF YOU DEAL WITH A PRIVATE HEALTH INSURANCE COMPANY.THE WYDEN COMMITTEE SUGGESTS:
1). USE EXTREME CAUTION IF CALLING A TV HELPLINE . The Federal Medicare program does not advertise MA plans or benefits on television. These so-called helplines will connect you with an agent or broker. That agent or broker does not have to tell you about all of your options in the Medicare program, and does not have to ensure that your plan will meet your needs.
2). IF YOU THINK YOU HAVE BEEN ENROLLED IN A NEW PLAN THAT DOESN’T WORK FOR YOU, CALL 1-800-MEDICARE FOR HELP. Seniors and people living with disabilities can also get no-cost counseling from the local State Health Insurance Assistance Program (SHIP) or Senior Medicare Patrol (SMP) office. In some situations, you may be eligible for a special enrollment period to switch back into your original plan. During the first three months of the year, you can also change your enrollment.
3). BE CAREFUL WHAT YOU CLICK. Third-Party Marketing Organizations are using sneaky tactics to get your information and then sell your information to agents or brokers who can call you. When in doubt, don’t provide your information on unfamiliar websites or unfamiliar people. The Medicare Call Center (1-800-MEDICARE) and your local State Health Insurance Assistance Program (SHIP) office can help you understand your Medicare choices and enroll in a plan that will meet your needs.
CONCLUSION:
Do everything you can to stay with (or return) to traditional Medicare and buy a supplemental Medigap policy. Beware of trusting those who may have ulterior motives, particularly when they present seemingly generous health insurance policy offers. Everyone should always remember that not all offers of help or generosity are genuine and that one should critically and thoroughly assess the intentions and specifics behind such programs and policies. This is particularly relevant in situations where aggressive sales agents of health insurance companies may present themselves as allies while harboring hidden marketing and sales agendas for Medicare Advantage.
Physicians for a National Health Program (PNHP) sum things up nicely:
Photo by Volodymyr Hryshchenko on Unsplash
“Medicare Advantage represents the worst of private insurance coming to take over the best system of health care that America has to offer. Insurers in MA prey on some of the most vulnerable among us, luring them in with false promises of superior coverage and low costs only to make every effort possible to prevent them from accessing necessary health care, all while siphoning billions of dollars from taxpayers. The more MA is allowed to expand, the more harm will come to patients, physicians, hospitals, mental health care professsionals and the health care system writ large. More patients will die waiting for care to be approved, more doctors will face tremendous burdens trying to prevent this outcome, and more hospitals in areas of critical need will close as MA plans refuse to pay for their services.
The money that goes to profit-driven insurers in MA should instead be used to improve Traditional Medicare, including by adding dental, vision, and hearing coverage as well as establishing an out-of-pocket spending cap. Traditional Medicare follows the original spirit of the program, one that was created to serve all Americans without the perverse incentives that come from a profit motive. This is the model we should be following in our health system, instead of devoting more dollars to the failed experiments of managed care. We must eliminate out-of-control profit seeking in Medicare and beyond, both by reining in the abuses of insurers via executive action and legislation, and by greatly expanding our public health insurance programs. It’s time to take Medicare back for the people”.
(For full PNHP report: Physicians for a National Health Program, “Taking Advantage: How Corporate Health Insurers Harm America’s Seniors,” May 23, 2024.
PLEASE SUPPORT THE M4A ACT-2025:
a). The Medicare for All Act of 2025, now filed in Congress, would provide health coverage to every U.S. resident—including comprehensive medical, dental, vision, mental health, and reproductive care—with no out-of-pocket costs, copays, or deductibles.
b). By eliminating waste and corporate profiteering in health care, the bill would save hundreds of billions annually that could be invested in actual health care, resulting in better, more equitable health outcomes.
c). By covering everyone without the copays, deductibles, and insurance networks that deter care and drive medical debt, M4A would achieve universal and comprehensive coverage, while assuring real choice of physician, mental health / health professional and hospital.
d). By eliminating profiteering and wasteful insurance bureaucracy (plus the administrative costs that bureaucracy inflicts on healthcare providers), it would — according to the Congressional Budget Office — free up $400 billion annually in funds that could pay for the cost of such coverage expansions and improvements.
e). Medicare-for-All could also effect a much needed shift in the ownership of care away from increasingly dominant private corporations to public ownership by Americans and their communities.
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