The Advantage Plans are completely corrupt

This is zero surprise. The amount of corruption is staggering. It is based entirely on lying to the American public that the private sector should have anything to do with “fully” insuring anyone. Medicine is not a private good but a public good. The profit motive entangles the country in a complete mismanagement of our individual health.

While the article says “most” do not kind yourself that things can be done this way. Tens of thousands of people are dying needlessly each year in the US.


I broadly agree with your views on this topic, but I worry that the headline and content are political rather than economic in nature.

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My take is different. Simply put, Medicare made it clear to insurers that reimbursements would be weighted by severity or complexity of illnesses. A diagnosis of a headcold has different levels of time consumption of management than a person who arrives at a medical office with a diagnosis of diabetes, copd, coronary artert disease, congestive heart failure, hypertension and renal insufficiency. Even if the visit is not specifically for ALL of those diseases, it is necessary to account for them since a medication for one condition (congestive heart failure, for example) could negatively affect another (renal insufficiency). So attempting on initial visit to document all conditions is reasonable and useful from a medical standpoint.

This is different from generating false diagnoses from “whole cloth” without documentation, which would be fraudish.



We have discussed this broadly here for a very long time.

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That is supposed to create cost savings. It can not because Medicare is more efficient than the private insurers.


It has been pretty well established that Medicare Advantage, and the Part D pharmacy program, were specifically written to benefit private insurance companies.


No, it was intended to reimburse providers…especially at primary care level and especially with the fixed reimbursement schedule of the Advantage plans…for the extra cost that patients with multiple co morbidities place on a practice. Just like bhmargolis states. However, this article highlights how a good idea can be abused.

This practice of up coding…or even creating false diagnoses…may be worse with Advantage plans but it’s not confined to them. Traditional Medicare AND regular group plans pay extra fees for sicker patients over and above what’s billed per each service. Remember my post ages ago on Chronic Care Management…a cross post from the Health Related Finances board and indirectly addressing this practice as it pertained to me.

FWIW, it behooves anyone with a medical insurance plan to scrutinise both the explanation of benefit info along with their listed diagnoses on their patient portal if available.


That’s true - but then try to get it changed.

Been a victim of this at the former practice that I was a patient of. Went back and forth a number of times trying to get the charges changed / dropped. They would not do it - said it would be falsifying medical records - when in fact, the medical record was incorrect at the time and I was trying to have it reflect what I experienced in the exam room.

That experience really solidified in my mind how healthcare is a for-profit business.



Well I’ve done it…so it’s obviously doable.

Truth be told, I’m not sure that the original inclusion of “hypertension” on my medical record was deliberate fraud but rather whatever software that the practice was using saw meds I was taking temporarily for a different but genuine condition and triggered the add on to put me in the “qualifies for Chronic Care Management” list.

I challenged it once I spotted it and the person who I spoke with at the practice took her job seriously enough and spent time going through my records, saw that there was no actual diagnosis in my clinical notes and, voila…fixed.


It was never a good idea…the cost inefficiencies have been known well before the law allowed for these private insurers. The allowance of private insurers in this market was sold to the public as cost savings because Medicare is “so wasteful” a blatant lie and as many lies shoved on top as possible.


I’m not sure exactly what you’re trying to argue. You seem to have an idee fixe re Medicare Advantage plans alone. Granted, the NYT’s article confined it’s discussion to these plans. I’ll agree that there’s the greater potential for such abuse with no incentive for patient oversight (no bills, no paperwork being popular with the satisfied plan members) AND I have an ideological dislike of insurance companies dipping their bread in the taxpayer funded gravy boat. However these practices aren’t confined to Advantage plans…or even trad Medicare.

More and more employer provided group plans…fee for service as well as managed care…are allowing extra reimbursement for those patients with multiple co morbidities over and above what’s generated per visit. I’m pretty sure that this fundamental good idea (and it is one, whether you accept it or not) is what has generated this apparent epidemic of up coding that verges on insurance fraud.

Medicare overhead is about 12 cents on the dollar. Doctor’s offices spend very little on top of that as their own overhead to collect.

Private insurers claim 22 cents on the dollar but that is just their costs. The doctors accepting private insurance have another 22 cents on the dollar of overhead. Of course there is a slight variance in my stats with some averages given but not much.

Private insurers match Medicare re-imbursement rates with slight variances. Private insurers are not a gift from god for doctors’ pay.

There are laws on the books insisting private insurers pay at all eventually. There are big holes in what private insurers cover. That includes with the advantage plans regardless of the crapola of no out of pocket costs. Just not true, an utter lie.

Anyone using a private insurer, I have one currently, is getting less for the money. It sucks.

It makes zero economic, financial or business sense to have private insurers. The exception is supplemental policies.

The policies to get here are based on endless lies. The corruption discussed by the times article is above and beyond the nonsense of having the private insurers involved at all.

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My PCP told me, about 15 years ago, his single biggest expense is the dealing with private insurance companies. Think about that for a minute. Leap is fundamentally correct, Medicare is very fiscally efficient, and private insurance is anything but that.


My wife has the opposite experience - her biggest administrative headache is dealing with Medicare, while dealing with private insurers is a breeze. Of all the insurances she takes, Medicare is the least customer-friendly for her as a provider. She stopped taking them altogether for a while, because it just took too much of her time to get her payments processed.

She’s a psychologist, so perhaps that makes a difference. Private insurance pays very little for mental health services, so perhaps they work harder to keep happy those providers are willing to take their rates? Though my brother, a podiatrist, had the same experience back when he had his own practice - Medicare was his biggest nightmare, and he vastly preferred dealing with any private insurer in place of them.

Talking about two different things. I’m not talking about how efficient it might be to get what you’re owed when you’re owed it but rather whether the amount that Medicare (or any other third party payer) deems appropriate for the operating costs attached to providing care.

Those specific comparison costs for insurance collection from Medicare vs commercial insurance have the ring of implausibility to me. If it is as low as stated, it’s because CMS has a well thought out plan of denying claims enough times that providers tend to give up, it seems to me.

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Oh, I see. Personally, I never assumed that those differentials were entirely based on claims processing costs. Though that’s certainly part of it. Certainly they don’t seem to be spending much on folks to help physicians manage their claims.

But mostly, I’ve always thought it was because Medicare can avoid big administrative expenses that private insurers have to manage. They don’t have marketing or customer acquisition costs, because they force everyone in the country to start paying for their coverage as soon as they enter the workforce. They don’t have competitors, so they don’t have churn among their coverage base (ie. the administrative costs of managing customers entering and leaving their pools). They have virtually no cost of capital - private insurers have to provide returns to shareholders in exchange for getting enough money to meet minimum capitalization requirements from regulators, while Medicare doesn’t have to bother with that at all. And finally, because the elderly just simply have bigger medical expenses than other populations, all of their costs are going to be smaller expressed as a percentage of claim dollars (ie. if it costs $50 per enrollee to process claims, that’s going to be a much bigger percentage for enrollees that have $1,000 in annual claims than those who have $10,000 in annual claims).

Albaby…I don’t think your wife’s experience with Medicare is atypical. Even though my husband’s income has always been via a prenegotiated salary from a large academic center…so hasn’t been responsible for his own billing…he agrees that , when it comes to having to deal with third party payers, CMS (Medicare and Medicaid) has commercial carriers beat for obstructive practices.

I’m sure there are statistics somewhere analysing this but the quoted figures sound a bit suspect to me.


Here in CT about twenty years ago there was a reason private insurers became payers at all. Aetna at the time a CT company was not paying doctors what was owed at all. The state of CT stepped in and mandated the bills be paid within six months. I am sure that made things easier.


Because objecting to bills is a sport.

The difference is not seen in the shrinks or foot doctor’s offices. It is seen in the costs of major health care costs. What happens when the private insurer argues the small but mounting costs of a major surgery? What happens when the 80% cost cap is reached?

Getting your state’s legally mandated coverage of possibly around $3000 of psychology coverage is not the debate. Getting a minor surgery on a foot wart or an ingrown toenails those are not problems for the private guys. But those two specialists might need to bill Medicare differently than a private insurer. When you say this you’d have to know how their respective billing worked in those days in the back office. Today Medicare would not be behind the times.

Well my dad and his friends who are mostly doctors would say the exact opposite that the private guys were terrible.

More importantly about fifteen years ago all of them decided socialized medicine would be better all around for society and the economy.

My cousin’s wife a radiologist in Waterford, Ireland who has worked here at Yale and Duke, says doctors’ pay in Ireland is on a par with the pay in the US. More over the cost of tuition to become a doctor is $15,000 for the five years of training.

We are nuts and there is plenty of lying to keep us nuts. Present company excluded.


There are no free lunches. Many insured are attracted by “free” eyeglasses and dental services to take advantage plans. We have “standard” Medicare A, B and D backed up with a high-deductible F+. Getting Medicare on the phone can be tedious, but frankly we have no issues with the coverage or what doctors we can drop in to.