Medicare Advantage is arguably the most controversial health care program right now — a sentiment that was bolstered Friday by striking new data about overpayments and an uncommon political jab during a routine meeting of policy wonks.
The Medicare Payment Advisory Commission, a group that advises Congress on Medicare policy, gathered to discuss its pending March report on the state of Medicare Advantage, the alternative to traditional Medicare that is run by health insurance companies. Medicare Advantage is expected to cost taxpayers $507 billion this year, according to the latest federal estimates.
The group, known as MedPAC, came to several familiar conclusions from the staff’s presentation and report: The federal government significantly overpays Medicare Advantage insurers because they attract healthier, lower-cost people into their plans and then excessively code those people’s health conditions — making Medicare Advantage a drain on taxpayers. MedPAC’s staffers also reiterated that Medicare Advantage’s quality rating system is “not a good basis for judging quality,” and therefore leads to further overpayments because insurers are paid bonuses based on this quality system.