Stark: Time to reform Medicare Advantage

A recent report shows private health insurers must be watched more carefully lest they misrepresent Medicare Advantage plans to consumers, House Ways and Means Health Subcommittee Chairman Pete Stark, D-Fremont, said today.

This is, he says, yet another reason to pass the House’s health care reform legislation.

A Government Accountability Office report released last month found 73 Medicare Advantage organizations representing 7.4 million beneficiaries – about 71 percent of all MA beneficiaries – were penalized for marketing abuse through Feburary 2009. The abuses include efforts to mislead, confuse or misrepresent the MA plan to beneficiaries.

Stark has been hammering away at Medicare Advantage’s shortcomings for years, accusing insurers not only of marketing abuses but of price gouging and other means of profiteering. This GAO report follows up on hearings by the Ways and Means Committee in 2007 and 2008 at which Medicare beneficiaries and their advocates testified about marketing abuses, saying they’d been given misleading information or enrolled in MA plans without their knowledge, and later found that these plans did not meet their needs.

“This report reaffirms that private insurance companies won’t behave without the government holding them accountable. The Obama Administration is making improvements on the dismal oversight record of the Bush Administration, and this report shows that more can be done,” Stark said. “The health reform legislation that passed the House, H.R. 3962, helps combat these abuses by allowing states to enforce marketing rules and expanding the definition of marketing violations.”

Medicare Advantage offers plans in which people can get their Medicare benefits through private health insurance plans; the Centers for Medicare & Medicaid Services (CMS) is responsible for overseeing MA organizations and their plans. But Stark said the CMS gathered data only from beneficiaries who proactively told CMS about what they believed were marketing abuses; enrollees may disenroll from MA plans during open enrollment without notifying CMS of a marketing abuse. CMS officials have said that they plan to reinstitute a survey on reasons for beneficiary disenrollment in order to expose more marketing abuses and accurately track victims of marketing abuse.

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.

  • Jeff

    Yes going after misrepresentation concerning Medicare Advantage is a good idea. For instance after beneficiaries of the program discover that the cuts in reimbursements to the program in the health legislation will result in cuts in benefits, and not just remove some claimed windfall profits of insurance companies, voters should hold the Democrats accountable for their misrepresentation of the effects of those cuts. It may well be justifiable to remove the higher amount of money that goes to such coverage but it is nonsense to suggest that seniors in the program don’t reap benefits from it.

    By the way, being a knowledgeable consumer for health insurance is exceeding difficult for just about anybody and for many seniors, almost impossible. We really need people to rely on trustworthy, independent third parties for advice. Only professional consumer advocates can match the professional marketers. The learning curve and analytical skills for doing a good job simply aren’t part of most people talents or inclinations.