News Release

Medicare Advantage Is a “Cash Monster”


The New York Times recently published an investigative piece on Medicare Advantage, revealing that major health insurers have exploited the program “to inflate their profits by billions of dollars.” Kaiser Family Foundation, meanwhile, has found that the companies “typically earn twice as much gross profit from their Medicare Advantage plans as from other types of insurance.

    Kahn is a professor of health policy at the University of California at San Francisco and an editor and blogger at Health Justice Monitor.

Kahn said: “Medicare Advantage is a cash monster focused on maximizing revenue and profits regardless of the impact on beneficiary access to care.” Kahn summed up two of the key points from the New York Times’s reporting:

  1. “The full extent of the cash extraction from Medicare is due to both legal and fraudulent diagnostic upcoding, and critically the failure of CMS to exercise its regulatory authority to correct for this upcoding.”
  2. “The projected excess payments to Medicare Advantage is $600 billion over ten years.”

Kahn hopes that the media attention the Times is bringing to this issue “represents a sea change in how the public understands and reacts to the private insurance takeover of Medicare Advantage, of Medicaid, and… traditional Medicare.”