Stark wants to bar Medicare Advantage gouging

pete-stark.jpgRep. Pete Stark, D-Fremont, chairman of the House Ways and Means Health Subcommittee, today introduced the Medicare Advantage Truth in Advertising Act, a bill which would prohibit Medicare Advantage plans — private plans which receive payments from Medicare — from charging seniors and people with disabilities more than traditional Medicare would for any service.

“Medicare Advantage plans don’t live up to their name,” Stark said in a news release. “Though seniors and people with disabilities wouldn’t know it from the never-ending stream of insurance propaganda, Medicare Advantage plans charge more than traditional Medicare for a large number of services – everything from home health care to hospital stays and chemotherapy drugs to durable medical equipment. The Medicare Advantage Truth in Advertising Act protects beneficiaries by ensuring they won’t face higher out of pocket costs in private plans than they do in Medicare.”

Stark’s bill would continue to permit flat co-payments — which private plans charge for certain benefits or services in lieu of deductibles or co-insurance in traditional Medicare — but those charges could never exceed Medicare’s charges, as Stark says they often now do.

“While MA plans are required to cover everything that Medicare covers, they do not have to cover every benefit in the same way,” said National Committee to Preserve Social Security and Medicare president Barbara Kennelly. “For example, private plans may create financial barriers to care by imposing higher cost-sharing requirements for benefits that protect the sickest and most vulnerable beneficiaries. Preventing private plans from imposing greater cost-sharing requirements than traditional Medicare would better protect beneficiaries from higher and unexpected out-of-pocket costs.”

And marketing agents have been found to lie about MA premiums and physician participation in private plans, Stark claims. They’ve also taken advantage of individuals with serious language barriers or cognitive impairments and enrolled beneficiaries who thought they were signing up for new Medigap plans in Medicare Advantage. “Press reports confirm that a number of beneficiaries have joined such plans with little or no understanding that their out-of-pocket expenses may actually be higher, rather than lower compared to traditional Medicare,” said Bill Vaughan, Senior Policy Analyst at Consumers Union.

Josh Richman

Josh Richman covers state and national politics for the Bay Area News Group. A New York City native, he earned a bachelor’s degree in journalism from the University of Missouri and reported for the Express-Times of Easton, Pa. for five years before coming to the Oakland Tribune and ANG Newspapers in 1997. He is a frequent guest on KQED Channel 9’s “This Week in Northern California;” a proud father; an Eagle Scout; a somewhat skilled player of low-stakes poker; a rather good cook; a firm believer in the use of semicolons; and an unabashed political junkie who will never, EVER seek elected office.

  • Medicare Advantage Plans are part of a law (2003 Medicare Modernization Act) written by the insurance industry for the insurance industry. Not only do these outrageous industry subsidies cost taxpayers $1,000 more for each and every beneficiary enrolled in private plans but all Medicare beneficiaries are also paying higher premiums to pay for it. Not to mention taking away 2 more years of solvency from a Medicare program already facing serious fiscal challenges thanks to national runaway healthcare costs. It’s obscene.

    Thanks to Congressman Stark for taking this one on. It won’t be easy because the insurance industry isn’t going to roll over and let billions slip through their fingers without a massive fight.