Medicare Advantage Overview

The more than 67 million older adults and people with disabilities covered by Medicare deserve affordable, high-quality health coverage choices. Right now, private insurance companies offering Medicare Advantage (MA) plans — which cover more than half of the Medicare population — are abusing the payment system and increasing costs for Medicare beneficiaries and taxpayers by billions of dollars every year. These overpayments to MA insurers erode the integrity and fiscal sustainability of the Medicare program.

• Medicare Advantage Enrollment is Growing 
  • MA is an important and growing part of the Medicare program, with more than half of Medicare enrollees now covered by private insurance companies, up from 1 in 3 in 2018.
• MA Costs Taxpayers and Seniors Billions Annually in Excess Payments
  • MA was created to deliver efficiencies and cost savings to the Medicare program. However, it has never produced savings relative to traditional Medicare, and it actually costs the program — and taxpayers — substantially more per enrollee, contributing to Medicare’s fiscal challenges and threatening its solvency.
  • Overpayments to MA plans will be an estimated $76 billion in 2026, driven in part by their abusive billing practices.
  • Taxpayers will pay $22 billion in excess payments in 2026 due to insurers’ coding practices alone
  • Premiums that all Medicare beneficiaries pay will be $11 billion higher in 2026 due to overpayments to MA insurers.
• Waste, Abuse, and Fraud is Widespread
  • Multiple federal lawsuits, investigations, and expert analyses have documented and exposed the abusive and, in some cases, fraudulent billing practices MA insurers use to game the system and increase their Medicare payments.
  • Audits have found that insurers are reporting diagnostic codes through health risk assessments and chart reviews that, in some cases, have little or no connection to patients’ health and for which enrollees did not receive any care.