Wayne O'Leary

MediScam

A grinning apparition from the past has been all over television lately. Joe Namath, former quarterback for the New York Jets and onetime bon vivant, peers out of the screen almost nightly, looking slightly cadaverous and somewhat ravaged, as though he’s just taken a heavy hit from the Baltimore Colts in Super Bowl III. Broadway Joe is no longer throwing footballs; he’s slinging something else these days, as a pitchman for America’s health-insurance companies.

Namath is just one in a lineup of aging celebrities, mostly sports personalities whom those coming of retirement age can presumably relate to as happy reminders of their generation’s heyday. Others include good ol’ boys Joe Theismann and Mike Ditka, both ex-NFL stars, and at least one good ol’ girl, primetime broadcast journalist Meredith Vieira. What they all have in common is that they’re well-paid spokespersons for the peddlers of Medicare Advantage, the private, corporate-sponsored alternative to America’s government-run Medicare program for seniors.

Their sales pitches are on behalf of independent insurance agencies that contract with major carriers in the Medicare business (UnitedHealth Group, Humana, Aetna, Anthem, Cigna, etc.) that in turn hold government provider contracts with the federal Centers for Medicare and Medicaid Services (CMS); the agencies serve as conduits, offering guidance through a confusing maze of choices and signing up customers for multiple Medicare Advantage plans — there were an average of 39 per county available to choose from nationwide in 2020. Namath and Ditka, for instance, represent the Medicare Coverage Helpline, while Theismann shills for easyMedicare.com, an affiliate of e-Telequote Insurance Co., and Vieira for myHealthPolicy.com, a creature of CNO Financial Group Inc.

The Medicare Advantage sales hustle is a series of hard sells disguised as public service announcements. “This is important information,” declares Joe Namath, urging the unaware to “get everything you’re entitled to.” There are benefits out there retirees deserve and aren’t getting, Joe informs us with alarm, so “make sure that your Medicare coverage is up to date.” Just make the call, he exhorts; “it’s free!”

Insurance agents are also beating the bushes through the post office. Dozens of cards and brochures reach my mailbox every week with similar pitches. See if you’re eligible, goes the refrain. (Needless to say, everyone over 65 is “eligible.”)

So, as Donald Trump might ask, What the hell is going on here? Quite simply, what’s going on is an attempt to unravel a major piece of the country’s social-insurance system with the purpose of generating money for a corporate special interest, the insurance industry. It’s an effort that’s been under way for some time, flying under the radar, but thanks to Trumpist ideologues, it’s come fully into the open.

Medicare Advantage is not exactly new; its antecedents go back to the Reagan administration, which let the camel’s nose under the tent by developing incentives for private insurers to contract with Medicare for managed care through health maintenance organizations (HMOs). The process was formalized in 1997 under Bill Clinton, who signed on to the creation of Medicare Part C, the “Medicare-Plus-Choice” program that divided Medicare into multiple financing and delivery systems, allowing private HMOs, preferred provider organizations (PPOs), medical-savings-account plans, and private fee-for-service plans to receive government funds and compete directly with original public Medicare.

Then came the Medicare Modernization Act of 2003, instituted by George W. Bush; it expanded Medicare-Plus-Choice exponentially by adding large federal subsidies that enabled private insurers to reduce their administrative costs and premiums while introducing benefit enticements. This vastly enlarged Part C, renamed Medicare Advantage, owed its rationale to self-serving propaganda by the big insurers claiming a more efficient private managed-care scheme would cut Medicare costs and lower the federal deficit.

It didn’t work out that way. Subsidy payments to major insurers drained the overall Medicare budget from the start, since the CMS spent much more on Medicare Advantage recipients than on regular fee-for-service Medicare recipients — between 12% and 14% more per beneficiary through 2010, when Obamacare applied the brakes and gradually cut the differential to 6% by 2013 with the intention of eventually phasing it out entirely. That never happened. Protests led by the corporate lobby America’s Health Insurance Plans (AHIP) and various physician groups, as well as numerous captive members of Congress from both parties, stopped the move toward budgetary neutrality in 2015; the trend was thereafter reversed by the Trump administration.

Given that their excessive government largesse enables Medicare Advantage firms to engage in mass advertising and provide CMS-endorsed extras unavailable on traditional Medicare, the predictable result has been an inexorable rise in their policyholders — from six million in 2005 to 20 million in 2019. Today, a third of seniors are on Advantage plans, and some projections indicate it could be close to half within a decade.

The Trump administration, led by its CMS Administrator Seema Verma, a sworn enemy of government-run health programs — they’re immoral, she says — has accelerated the movement to fully privatize Medicare. In 2018, under her purview, Medicare Advantage plans, already dangling inducements like free eyeglasses, hearing aids and gym memberships, were authorized to add innumerable new benefits to attract seniors. Verma made the Trump agenda clear in a 2019 speech: “What works in Medicare is Medicare Advantage.” To ensure that success, allocations for Advantage plans (that is, subsidies) were increased, and the president himself called for lowering the premiums they routinely charge above and beyond the basic Medicare premium, something enhanced subsidies will encourage.

Unfortunately, the added benefits of private Medicare come at a stiff price. We all pay for them indirectly, through federal taxes or higher premiums on basic Medicare, while insurers profit. A two-tiered Medicare system, one for comparatively well-to-do and healthy retirees (Medicare Advantage), another for the less wealthy with more serious health conditions (original Medicare), is being locked into place, replete with preselection of patients and chronic overbilling of the government by insurers using fraudulent “risk-adjustment” diagnoses.

What’s more, even those on Medicare Advantage are disadvantaged; their extra benefits are not free. An overwhelming majority of Advantage plans carry premiums, and most demand copays for doctor visits. They use strictly limited provider networks (subject to change) and require pre-authorization for treatments. They are also notoriously stingy with long-term care and employ “gatekeeper” physicians to minimize access to specialists. In the timeless words of the proverb: Let the buyer beware.

Wayne O’Leary is a writer in Orono, Maine, specializing in political economy. He holds a doctorate in American history and is the author of two prizewinning books.

From The Progressive Populist, February 15, 2021

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