Medicare Advantage was supposed to be a money-saver. It’s now become a costly, unaccountable cash cow for private insurance companies that is swallowing traditional Medicare.
This reconciliation bill is being opposed by every Republican in Congress as well as the drug companies, the insurance companies, the fossil fuel industry and the billionaire class. They want to maintain the status quo in which the rich get richer.
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The simple solution to the Medicare Advantage problem is to kill off the program. It was just a Trojan horse to privatize Medicare, and its presence will make Medicare for All even harder to implement.
The study notes that most Medicaid recipients are on private managed care plans and about one third of Medicare enrollees now have Medicare Advantage plans. Both of these types of plans have higher overhead costs than the publicly administered plans.
An inefficiency gap is boosting costs — and profits
It’s no surprise that WellPoint and its affiliated Blue Cross and Blue Shield companies are the biggest contributors in a $37.5 million campaign to stop Proposition 45, which would require the insurers to get state approval to raise rates. The measure would require approval by the elected state insurance commissioner for changes in health insurance rates or anything else that’s part of a policy.
The Hospital Trust Fund accounts for only about half of total Medicare spending. Most of the rest goes to cover physician fees, prescription drugs and to provide incentives for health insurance companies to participate in the Medicare Advantage program and administer the Medicare drug program. The Affordable Care Act could have done much more than it does to curb spending in those areas.
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