Deceptive billing practices from big insurance companies may be driving up costs for all seniors on Medicare, according to a new report from the Congressional Joint Economic Committee out this week.
The report specifically examined billing practices for Medicare Advantage, the private insurance alternative to traditional Medicare used by tens of millions of seniors. The report does not dispute that the program provides valuable benefits – including dental, vision, hearing coverage, and prescription drug plans – but raises concerns that certain payment practices within the system may be forcing seniors to pay more out of pocket for care.
About 55 percent of Medicare beneficiaries are now enrolled in Medicare Advantage plans, reflecting the program’s growing popularity. But the report estimates that Medicare Advantage payments averaged roughly 120 percent of what it would cost to cover the same beneficiaries under traditional Medicare in 2025, resulting in an estimated $84 billion in additional federal spending.
Because Medicare Part B premiums are tied to program costs, those higher payments can ripple outward and affect all beneficiaries. According to the report, Medicare Advantage overpayments increased Part B premiums by about $212 per enrollee in 2025, totaling $13.4 billion in higher premiums nationwide.
Over the past decade, the cumulative effect has been even larger. Since 2016, these additional costs have added an estimated $82 billion to Part B premiums, meaning seniors and taxpayers alike have borne the financial impact. For some families, the added costs could be even higher – potentially hundreds of dollars extra each year due to inefficiencies in the system.
Those costs could grow in the years ahead if reforms are not implemented.
The report warns that if current payment trends continue, the additional premium burden could reach about $450 per beneficiary annually by 2035, at the same time that overall Medicare costs are projected to rise. Baseline Part B premiums themselves are expected to climb sharply – from roughly $2,200 per year in 2025 to about $4,500 annually within a decade.
That matters for millions of seniors because Medicare premiums are typically deducted directly from Social Security checks, meaning higher premiums translate into lower take-home benefits.
The report notes that the vast majority of this added burden ultimately falls on individuals rather than government programs. Roughly 85 percent of the increased premiums are paid directly by beneficiaries, while the remainder is covered by federal and state taxpayers.
Several factors appear to be contributing to these higher costs.
Rep. David Schweikert (R-AZ), who chairs the Joint Economic Committee, pointed to “aggressive upcoding, questionable quality bonuses, and structural overpayments” as key drivers.
Risk-adjusted payments in Medicare Advantage are designed to ensure that plans covering sicker patients receive more funding. In theory, this system helps guarantee that seniors with chronic conditions receive adequate care.
However, the system can also create incentives for insurers to document more diagnoses.
As The Wall Street Journal explained, Medicare Advantage plans receive higher reimbursements “to cover enrollees who have more health conditions.” While that structure can help protect patients with complex medical needs, it may also encourage insurers to record additional diagnoses that increase reimbursement levels.
A 2024 investigation by the paper highlighted one area where this dynamic may be occurring: in-home health visits conducted by nurses working with insurance plans.
While home visits can offer convenient care for seniors, the investigation found that nurses were sometimes encouraged to conduct extensive diagnostic screenings during visits and add additional diagnoses.
Between 2019 and 2021, the Journal reported, insurers received an extra $1,818 per visit on average, translating into roughly $15 billion in additional payments during that period.
Many of the diagnoses recorded during those visits appeared only on in-home assessments and were sometimes generated using automated software suggestions rather than confirmed through follow-up medical evaluation.
Medicare and Medicare Advantage remain important programs that support America’s seniors – many of whom spent decades paying into the system and continue to contribute through premiums during retirement.
For that reason, policymakers from both parties increasingly agree that the system must ensure funds are spent wisely and that payment structures do not unintentionally drive up costs for beneficiaries.
Controlling unnecessary spending is particularly important because Medicare’s financing structure means that higher program costs often translate directly into higher premiums for seniors.
AMAC Action has previously supported efforts in Congress to address these concerns. Last November, AMAC Action backed the No UPCODE Act, legislation designed to reduce incentives for aggressive diagnostic coding in Medicare Advantage.
The bill would require Medicare officials to adjust risk scores to account for differences in coding between Medicare Advantage and traditional Medicare. By limiting the ability of plans to inflate risk scores through additional diagnoses, the legislation aims to ensure that payments more accurately reflect patients’ actual health conditions.
Supporters say the measure would help protect both taxpayers and seniors while preserving the benefits and choices that Medicare Advantage offers millions of Americans.
As Rep. Schweikert put it, Congress must continue examining the program to ensure “affordability, fiscal responsibility, and fairness” for the seniors who rely on Medicare.
Matt Lamb is a contributor for AMAC Newsline and an associate editor for The College Fix. He previously worked for Students for Life of America, Students for Life Action, and Turning Point USA. He previously interned for Open the Books. His writing has also appeared in the Washington Examiner, The Federalist, LifeSiteNews, Human Life Review, Headline USA, and other outlets. The opinions expressed are his own. Follow him @mattlamb22 on X.
Advantage plans are not very attractive although they sell by implying freebies. The whole Obama mess is a joke. On top of the messed up insurance we face massive fraud with illegals using our healthcare and welfare programs. Once again; government is the problem!
Congress needs to get out of the medical business. Every time Congress “fixes” things, my costs go up and the quality and availability of care goes down. One or two more examples of congressional meddling and I probably won’t be able to get any care at all, at least that I’ll be able to afford!
Call it what it is. This isn’t waste, it’s fraud. I won’t touch an advantage plan. I don’t want an insurance company dictating my medical decisions. I use a supplemental plan and I can be my own health advocate.
Obama destroyed Health Care in our Country .
This is a twist. I experienced just the opposite. My insurance denied a claim for rehab after I had influenza A and bacterial pneumonia and suffering from congestive heart failure, stage 3 kidney disease, a 5 cm aneurism in my ascending aorta. They decided I could go home after 8 days in the hospital because I could walk 23 feet with a walker unassisted. They did not take into account that I was out of breath after those 23 feet. I could not dress myself or shower without being out of breath. How was I going to take care of myself. With a Home Health Aid? Really? They don’t cook for you nor clean nor dress you. I paid privately for rehab which cost me 12,000 dollars. No overpayment here. Must be in CA and other dem states. Surely not for MAGA patients. The premiums have gone up and benefits are down. Home Health care is nothing more than someone taking your blood pressure and analyzing how many more visits they can create. That is a program that should be scrapped and instead housekeeping or cooking benefits started. I take my own blood pressure, heart rate and oxygen level as do many seniors. The copay for hospital
stay went up from 140 dollars for the first 5 days to 260 dollars. Really almost a 100% increase. But if you can walk 23 feet after laying in a hospital bed for 7 days my insurance decided I was fit as a fiddle to take care of myself and oh yes they also said I had a daughter. That assumption that she would or even could take care go me was not only laughable it was making an ass out of themselves. After more than 20 years paying premiums and copays don’t live so long that you become expensive. The insurance companies leave you in the dust to die.
This waste is outrageous! They keep fleecing the seniors to have to keep paying more and more with unnecessary tests which drive up costs. The doctors have no say anymore in the patients care. You have to have this test first before you can go to the next step. If you take care of the problem without these insurance companies dictating what needs to be done instead of listening to the doctors. People are dying because they have to wait to see a specialist before these other tests can be done. I know of several people who have died because of this situation. Our health care and medicines are too expensive, and seniors are going without eating. My friend now has to take Eliquis for her heart, and it cost her $700.00 for 3 months. If she just bought only one, it would have been more costly!! How can seniors be expected to pay these outrageous costs?
Not sure, as a senior, what is worse – being screwed by greedy insurance companies, or trusting elected “representatives”, bought and paid for by the all-powerful insurance industry lobbyists. The insurance industry and its “products” continue to get worse and worse. Health insurance, homeowner’s insurance, auto insurance – all becoming less and less affordable, covering less and less, and not there when legitimate claims are made against the policies.
After the ACA was forced down our throats, the escalation of Advantage plans and “dual eligibility” hitting Medicaid for more money have expanded the “bleeding” of funds. The requirement to switch to ICD9 to ICD10 also forced “created” many MORE codes to cover single code items of prior ICD9’s. The Obama / DEM scheme is working to bleed patients / Medicare and SS and enrich the medical and drug establishments. SS is not failing due to not enough funding, it’s failing due to MASSIVE fraud and raiding to a reported tune of nearly $2Trillion and likely much more. Where do you think the “funds” come from when things like the CARES Act, HEROES Act, IRA, Infrastructure Act, … that need $trillions to enact, do they just “pop” out of thin air or are generated “instantly” like the bleeding of them with little if any oversight??
C”MON MAN!!!
Any federal program is ripe for abuse. The government is to large, and unresponsive to be able to address the issues in a timely fashion. Social welfare programs are even more vulnerable because some segments of society, no matter income level, are primed to take advantage of federal help. This is made worse by a legal system that insists if you help some you have to help everyone. Eventually almost everyone tries to be on the take for life.
We’d all be living a more comfortable life if we weren’t constantly being ripped off by our state and federal governments, politicians, insurance companies and doctors, hospitals, and clinics.
That yearly Medicare Wellness visit is a joke. Then they send out a separate “home visit” that basically asks the same questions and takes your blood pressure. A total waste of time and they get paid ridiculous sums for both. The Wellness visit is not to see the doctor for any problems – you have to set up a separate appointment for that. And I agree about seeing specialists – you have to get referred to the specialist, then wait months for that appointment, then they have to schedule tests which takes a bunch more weeks – I truly believe once you get old, they figure the longer it takes to get things done, the sooner you will die and not be a drag on society!!!
And I’m so sick of those “check your zip code” so you can get all those extra benefits commercials. Yeah, you have to be on Medicaid also, but they never mention that!
When any Insurance Company sees a way it can get more Money, it will do so, HOOK OR CROOK. I worked in Insurance for 40Years, and, I learned to never trust a Casualty Insurer.
CUT DC Hq bureaucracy can help
Change policies
Change rules
Privitize some services
Too many are receiving benefits unjustly.
Day and night, the “advantage” plans are hawked! “No premiums, no co-pays, etc.” NOTHING is FREE; somebody [we taxpayers] is paying for it. Plus, as DJT says, the insurance companies are raking in federal and state subsidies. These Obamacare policies were forced to cover sex changes, abortions, and pregnancy. How does that help a normal older person?
I don’t understand why Medicare Advantage Plans have added perks: groceries, hearing aids, dental.
Kaiser Permanente embezzled 447 Million from Senior Advantage during the pandemic and now has to pay it back .
And where was the Congressional Joint Economic Committee for the past 10 years? The government promoted Medicare Advantage Plans!! CMS spends billions of dollars which they can barely keep track of and insurers rake it in no matter what the economy does. Then the grateful insurers fund their reelection campaigns! Kind spells recipe for disaster for we the people. At the end of the quid pro quo game they then claim they no longer have funding for seniors. What a joke! WE NEED GOVERNMENT REFORM AND INSURANCE REFORM!
I wish I had never chosen UHC again this year – everything has gone up!!!
I get a little tired of hearing yet another report about the waste in Medicare…..and nothing about what or who is doing anything to stop it, and return the monies stolen by fraud and greed. It’s long been known that any and all “benefit” programs of the government have been and are being robbed across the board, and for just as long, no action has come to bear to stop or even curb such blatant thievery. So, skip the reporting of what we all know and tell us what’s being done that is ending this saga of graft and greed.
Question: Why do I have to remember 3 words and draw a clock for my yearly office visit? That is a waste of my Medicare and could go for better places.
the us gov senate house steal over 600 billion a year is anyone surprized and this is not new this has been going for over 100 years
I have always thought those ADVANTAGE plans ripped off the government. They wouldn’t be advertised so heavily if they weren’t making a lot of money.
There’s no such thing as a free lunch. eyeroll emoji x100
The Insurance Industry with their lobbyists OWNS Congress! Obama & the demon crates had the majority in Congress when they passed the un-Affordable Care Act. They basically handed over the pen to the Insurance Industry. The insurance industry wrote the ACA into law, to their benefit.
When a pencil jockey in an office decides what medical care you need rather than a doctor, fraud and abuse rule the day. The government needs to ditch the health care business and crack down on the health insurers. Of course, their lobbbyists make sure the politicians palms are greased so than nothing is EVER done.
The Mob didn’t come up with the term “Insurance Racket” from nothing! Any type of insurance can be abused. I had car insurance from one well known company and when I was in an accident that was not my fault the Agent refused to investigate even when I told him how to find the proof. Then he offered me so little to replace my car it was ridiculous (at the time I didn’t know you could refuse and contest an inappropriate amount. So my Mom and I shared her car. When I went in to pay the insurance due the person at the counter said but you folks always had two cars. I told her I couldn’t find any replacement with the amount I was given. When I told her how little the amount was her jaw dropped! I pointed out to her that this led to us having only one car to insure instead of two and that because of the Agent’s actions their insurance company would lose out as well. I guess the counter person spread the word because the next time I went in to make the payment I found out he was no longer there! I sure didn’t miss him!
Creation of a madman, bureaucratic nightmare, I wonder if it was created to discourage from visits, to camouflage the fact there are not enough doctors, or capable practitioners, because who in their right mind would want to be tangled in that web, unless it’s absolutely necessary and there is no other way. It’s straight from Kafka.
There seems to be no way, financially, that we on medicare can profit by staying healthy, example, I have one trip to my doctor per year, for annual physical. No lower premium for me, and for those with lifestyle ailments, pay less for part B. I just think that medical care fall under insurance companies, rather than medical doctors.
As a Pharmacist I want the additional Diagnosis. Many Drug – disease state interactions are overlooked because of omitted coding, which can lead to patient harm.
Fraud and greed within the insurance system, medical system and politicians who love a little under the table compensation has weakened and in some cases almost destroyed good medical care in this country. “The LOVE of money is the root of all evil”.
I have Medicare Advantage and it has been a God send.
Has the scam been put out in the open? What happens now? nothing. We need to come together and insist that something be fixed. Politicians need to be in jail
So what is being done about all the waste and abuse in Medicare and government? What is it that the elected officials do for us. Hmmm they are just weak speeple!
The Medicare Advantage Plan is nothing but an HMO, dictating which provider you can see or not see, stalling your treatment for your illness, hoping to keep those dollars within their own organization’s office. They do not want to send you to that Specialist as then they have to pay that Specialist out of their own funds they receive from the government, in other words, us the taxpayers money they’re getting. It’s all a tangled web. And don’t forget, if you go “out of plan”, you the patient very well may end up paying those fees out of your own pocket.
Medicare Advantage plans are allowed to drop coverage every year, often seniors are not aware or keeping up with that option,so they end up losing the ‘benefit’,
Doctors can reject servicing patients with a Medicare Advantge plan any time.
The government pays these insurance companies about $10,000 each anuually for enrollmemts.
Patients must use network hospitals and doctors, at the end of the year they may have to change all of their providers.
Patients may have to get and wait for approvals and second opinions.
Supplements may not have the low cost bells and whistles, but patients are free to use any provider without approval, or network, and for a few months before and after thei birthday, they are entitled to any Supplent plan at guaranteed issue.
Often visting agents neglect to fully explain the differences, and as we age it makes all the difference.
Maybe have those on the Medicare Dis-Advantage plans pay a higher premium to offset the increased benefits vs. traditional Medicare.
What gripes me is that, as traditional Medicare participants by necessity, my wife and I have to subsidize extra benefits that Medicare Advantage participants get, but we don’t. It isn’t fair.
No surprise to me since I am already paying over $6000.00 per year for Medicare Part B and Part D. This is insane as I am just one person and trust me when I say that I am not getting rich on Social Security. They need to fix this and somehow get control over the out of control Insurance Companies. In the last 4 years alone, my Part D coverage has gone up $100. per month and now I even get to pay a co-pay on Tier One prescriptions.
It appears to me that there are “few” members and /or adherents to AMAC, who have serious/voluminous experience in the business world, both inside and outside The U.S. who grasp the (my view) nefarious actions/thinking of the “health care Industry”, as functioning body that focuses on anything other than profits and stock price and investor returns. I’m full- on for private industry, as that bis where I spent my entire working life. I just this morning has a reasonably detailed discussion with a close friend, a retired MD, who I commiserated with, as to how we both early on elected to pursue our disciplines as first moral, American pursuits, and not first “profit” and economic /revenue personal accumulation. He echoed my assertion that the culture/society has dramatically changed, in which “profit motive” is the driver and not performance, i.e. being good/excellent at you chosen profession. I added that Congress, hospital corporations, et al have exacerbated the climate, as has academia, and the general malaise of “the people”. This is before we speak to the fraud, abuse and cheating that is now prevalent, not simply by Americans, but most importantly, non-Americans. Are there “leaders” who will fight the fight and end or at least blow this nonsense up?