Medicare Advantage Hilariously Explained

 John Oliver is a genius.  About a month ago, he hosted a show in which he royally roasted Medicare Advantage insurance.  He has the amazing ability to describe things in an easy to understand way that is thoroughly entertaining.  If you have not see the episode, take the time to watch it (it's about 30 minutes):

https://www.youtube.com/watch?v=Ejoi9yfLVCc

Some IBM retirees in Raleigh are not happy about IBM UHC Medicare Advantage because a popular provider, WakeMed, will no longer accept the UHC Medicare Advantage insurance in 2026.  Sadly, the options those retirees have are limited.  They can:

1. Find new providers who do accept the UHC MA insurance and ditch WakeMed.

2. Try to find a medigap company that will sell them a medigap and switch to OM + a part D stand alone drug plan,  and thereby lose access to their HRA, if they have one, because they will be disenrolling from IBM's MA plan.  In North Carolina, medigap insurance companies are not required to sell someone a medigap if they don't have a "guarantee issue".  There are only a few ways to have guarantee issue, such as if IBM terminated the UHC Medicare Advantage plan. They MIGHT sell you a plan but could charge you a higher premium if you have underlying health conditions. I do not recommend switching to original Medicare without a medigap.

3. Switch to a non-UHC Medicare Advantage plan that WakeMed will accept. 

The insurance switching options for #2 and #3 can be done before December 8, 2025, which is the fall open enrollment period for Medicare, or in January, February, or March of 2026.  If done in 2026, the switch will be effective the first of the next month. The 2026 three month period is know as the MA Open Enrollment Period (MAOEP).  During those three months you have a one time option to drop out of any MA plan and into original Medicare, or to switch from one MA plan to another.

Medicare part D 2026 Premium Increases for Medicare

 The impact of the "Big Beautiful Bill" is starting to surface.  This week insurance companies are sending out the "Annual Notice of Change" documents to people who have a separate part D plan.  Most often the policy holder has Original Medicare, meaning the insurance that was created in 1965. You might get sticker shock when you open the letter.

I've said this in the past, but it is worth repeating.  The passage of Medicare in 1965 was not popular with capitalists.  They believe any type of insurance coverage should only be available from private insurance companies even though health insurance typically is a product that is "inelastic demand", it is not the purview of a government agency.  However, before 1965, most health insurance companies wouldn't sell policies to "old people", especially if they had preexisting conditions.  Someone over 65 who doesn't have preexisting conditions is as rare as a snow storm in July (in the USA).

For the last 60 years, conservatives have tried every way possible to "kill" Medicare.  They are winning.  The bill passed in July gives MORE money to Medicare Advantage plans because they want to push more seniors to use MA which is "private insurance" and thereby dismantle Original Medicare.  To pay for this, the bill reduced funding to part D insurance plans by 40%.  

Obviously, part D insurance is also sold by private insurance companies. That also was setup by conservatives in 2003 because they did not want to extend any part of the federal government Medicare insurance, but constituents lobbied hard for drug insurance to be added to Medicare so they "contracted part D out" to private insurance companies.  These companies are in the business of making money.  One way to do is to increase insurance premiums.  In 2026, many part D companies are increasing the part D insurance premiums by $50/mo. 

Ask your congressional representative if they voted "yes" for the bill passed in July 2025 that causes this to happen.  If they did, are they really representing you?

Medicare changes in the bill passed on July 4,2025

 Although most health insurance discussions about the reconciliation law passed on July 4, 2025 are about Medicaid, there are significant impacts to Medicare and the Affordable Care that will diminish those programs.  Most of the impacts are difficult to understand, maybe intentionally, but I'll try to describe some of the Medicare impacts so that you can rant and rage to your elected officials about the broken promises of the current administration.

1. In 2023, Centers for Medicare/Medicaid (CMS) issued an order to make it easier for newly Medicare eligible low income people to automatically get help with the cost of Medicare.  The new enrollees currently must apply for those programs separately from enrolling into Medicare to get the benefits and many do not know assistance programs even exist.  The new rules were to go into effect in 2026 (because enrollment systems needed to be enhanced).  This bill stops that initiative and postpones any implementation of it until 2035.  

2. Medicare/Medicaid eligible recipients who reside in nursing homes have consistently encountered "understaffing" in the nursing homes, causing them to have a low quality of care.  Again, in 2023, an order was issued to focus on increasing staffing as part of licensing a nursing facility.  Those staffing regulations have been suspended.  Also, Medicare/Medicaid people will be less able to "age in place" in their residence because there are cut backs in those programs.

3. Lawfully present immigrants who paid payroll taxes for Medicare, will NOT be eligible for enrollment into Medicare even though they paid into the system.

4. This is complex.  There is something called "PAYGO" that relates to the overall cost of Medicare, if it runs a deficit in a given year.  It almost always happens.  Usually the deficit Medicare runs is added to the national debt (I am grossly simplifying this).  If that isn't done, then the Medicare healthcare coverage has to be reduced.  For example, the "free screenings" in Medicare might no longer be "free".

5. Stand alone part D drug plan premium increases and availability of part D plans are at risk.  We already saw some of it in 2025. Prior to 2025, the choices for a part D plan in a given zip code were around 30 plans.  This year it dropped to about 11 plans.  More importantly, the premiums for the plans increased in 2025 but there was a cap on how much premiums could increase and it was no more than $35.  There appears to be no premium increase cap after this year so there is no knowing what part D premiums will look like in 2026.  

The Affordable Care Act insurance has been hit hard too. The subsidies are drastically reduced and the insurance companies are already talking about how the premiums for ACA policies are going up more than 25% in 2026. Many policy holders won't be able to afford the insurance.

Medicare Advantage Horror Story

 Most articles I read about pros and cons on Medicare Advantage plans do not go into "what ifs".  Here's a "what if" that is hair raising:

A person who was seemingly healthy, had a Medicare Advantage plan (notice, I said "had).  They went to visit a grown child in another state.  Unfortunately, they had a severe medical emergency shortly after arriving in that state and were admitted to the hospital.  It was kidney failure. 

Once the person was stabilized and put onto dialysis, the "emergency' was over.  Unfortunately, as soon as it was no longer an emergency, the Medicare Advantage plan also stopped providing medical insurance because the person was not in their home state, and the MA plan is not obligated to provide "national insurance" coverage.  However, the person was too sick to be transported home.  Since they could not be immediately transported back to their home state when the emergency hit, there was also no medical coverage for transporting the very sick person back home.

The only thing the person could do was flip out of the Medicare Advantage plan and flip into Original Medicare (OM), which is possible because Medicare eligible people who are hospitalized get a "Special Enrollment" that allows them to do it. The person was also able to get a medigap, but only the most expensive one which was $400/mo. Also, the OM coverage only became effective the first of the next month, and the MA plan is refusing to cover the hospital days until the end of the month so the person has thousands of dollars of medical expenses to try to force the MA plan to pay by going through an very onerous appeals process.

The person is now "stuck" in another state until they are healthy enough to be able to travel back home.

Medicare enrollment changes for 2025

This is the time of year to reexamine your Medicare insurance and make changes that will be in effect in 2025.  For those of you who elected to enroll in the UHC Medicare Advantage plan, I urge you to look at the 2025 information you have received.  Medicare Advantage plans are reducing benefits and drug coverage because they are making less money (off the federal government).  Make sure you look at what has changed. 

 If you opted out of the IBM insurance and stayed in traditional Medicare with a separate part D plan, look at your part D plan to be sure it will still be the right plan for you in 2025.  You can do that by looking on www.medicare.gov or by calling Medicare (1-800-633-4227).

The biggest change that happens in 2025 is the change to the structure of the drug coverage.  All the phases and changes to copays as you move through the phases are GONE.  The copay you pay for a drug (after you met the deductible) will be the same until your total out of pocket for all copays for all your drugs (and includes the deductible) is $2,000.  At that point, there are no more copays for the rest of the year. As a result, the insurance companies are not making as much money on the providing of drugs.  Therefore, they raised the drug insurance monthly premiums.  The change in drug plan structure happens for MA plans too. 

Some retirees believe, because IBM sponsored the UHC MA plan, IBM is giving UHC money to keep the benefits robust.  I seriously doubt IBM gives UHC any money at all.  If anything, UHC probably gives IBM money!  Reminder, the federal government gives UHC a boat load of money every month for every Medicare Advantage policy holder.  If the policy holder has few claims, UHC gets to keep a  lot of government money.  Your tax dollars at work. However, IBM did give UHC a huge gift when they pushed retirees to UHC.  No need for UHC to spend money to advertise on TV to woo retirees to the plan, no need to pay insurance agents money for commissions, or if UHC does pay commissions, they pay it to IBM!!  

I continue to hear horror stories about Medicare Advantage denial of coverage for policy holders which sometimes ended in a denial of life saving procedures.  When something is too good to be true, it often isn't true.

Never enroll in a Medicare Advantage plan (it is a hazard to your health)

 AI used by brokers to pick plans to sell:

https://generations.asaging.org/medicare-decisions-should-not-be-left-ai

Prior Authorization prevents you from getting the health care you need:

https://ldi.upenn.edu/our-work/research-updates/the-billing-bottleneck-how-medicare-advantage-insurers-use-prior-authorization/

MA patients have lower rate of hospitalizations, and that might not be a good thing:

https://www.fiercehealthcare.com/payers/study-details-why-medicare-advantage-avoidable-hospitalizations-lower-compared-traditional

Humana decided there's more money to make in selling Medicare Advantage that selling Employer Group Health Plans:

fiercehealthcare.com/payers/humana-shed-employer-group-commercial-business

Surprise Billing:

https://www.fiercehealthcare.com/payers/cms-astronomical-volume-surprise-billing-dispute-cases-taking-toll-agency

Kaiser discussion on 2023 Medicare Advantage payments

One of the speakers, Tom Kornfield, spent 10 years at CMS before he went into the private sector.  He has a vested interest in disparaging the payment changes the federal government is trying to make to MA plans.  I point this out because this CMS changes affect his clients and thereby, indirectly affects the consulting fees his firm will get. I find it hard to believe his spin because of it. This is his background: Tom also spent 10 years working at the Centers for Medicare & Medicaid Services (CMS), where he held a variety of positions focused on MA and Part D payment policy. Specifically, Tom analyzed MA bids and payments and changes in MA payment rates, and he created a policy to allow for 5-star MA plans to market and enroll year-round. 

https://www.kff.org/medicare/event/march-21-web-event-unpacking-the-controversy-over-medicare-advantage/

Action Now Initiative March 3, 2023 letter to CMS captures why CMS needs to rein in the excesses of Medicare Advantage Billing:

https://www.arnoldventures.org/stories/whats-going-on-with-medicare-advantage-arnold-ventures-experts-explain

Analysis of how MA plans are sucking money out of Medicare.  It is soooo complicated.  Why won't the federal government stop the shenanigans?

https://www.healthaffairs.org/content/forefront/born-third-base-medicare-advantage-thrives-subsidies-not-better-care

Never enroll in a Medicare Advantage Plan (because they overbill the government)

 This is great analysis about the insurance industry siphoning off  Medicare funds (aka your tax dollars) and destroying Medicare:

https://www.morningstar.com/news/marketwatch/2024032679/medicare-advantage-is-overbilling-medicare-by-22

Never enroll in a Medicare Advantage Plan (ever)

 The interview in "MedPage Today" is great.  It is with a former CMS Administrator who was a doctor.  There are now many, many news reports about the problems with Medicare Advantage insurance. It is a wonder they are still legal!  Just search Medicare Advantage in the "News" category of your search engine and you'll see them.  Some legislators, like Elizabeth Warren, are trying to sound the alarm. 

https://www.medpagetoday.com/special-reports/exclusives/108980

Never enroll in a Medicare Advantage Plan

Unless you live in a state that requires insurance companies to sell you a Medicare Supplement plan, NEVER enroll in a Medicare Advantage plan, no matter how enticing it seems.  People who live in Connecticut, Maine, Massachusetts or New York are not locked into Medicare Advantage plans if they make the switch.  HOWEVER, if they have a health crisis, they will not be able to easily switch to traditional Medicare until certain times of the year. 

Medicare Advantage is so bad that Scripps, a huge provider practice in San Diego, has stop accepting the plans:

https://thecoastnews.com/two-major-scripps-groups-drop-medicare-advantage/

Rural medical areas around the country are being decimated by how bad it is to deal with Medicare Advantage plans:

https://www.nbcnews.com/health/rejecting-claims-medicare-advantage-rural-hospitals-rcna121012

I don't post much anymore because there is nothing else I can say besides kick IBM to the curb and don't use their plan! Don't use any Medicare Advantage plans.  During Fall Open Enrollment, if you can, go back to using traditional Medicare and a medigap.  Your window to "go back" no matter where you live, is closing.  You can switch back to what you had until December 31, 2023 because you had a 12 month "Special Enrollment" such that the federal government allows you to go back.  After December, it is unlikely you can switch to traditional Medicare unless you live in the four states named above.  

IBM Medicare Advantage NYT report March 23, 2023 re federal government efforts to stop MA fraud

 The NY Times published another report about Medicare Advantage antics on March 23rd.  The federal government is trying to reduce the ways MA plans suck money out of the Medicare trust funds and the backlash, not only from the insurance industry but from some medical providers, is despicable. It seems more than just the insurance industry enjoys sucking taxpayer money into their cash registers. 

The insurance industry is fighting hard by not only lobbying but by running ads telling seniors to complain to their representatives that the government is trying to take away their Medicare Advantage plans.  The lengths to which companies go to make money by deceiving the public is mind numbing.  This is the article, but I am not sure if it will be available to non-subscribers:  

https://www.nytimes.com/2023/03/22/health/medicare-insurance-fraud.html

              This letter to the editor is from a retired doctor who applauds the federal actions:

Re “Biden’s Plan to Cut Billions in Medicare Fraud Ignites a Lobbying Frenzy” (news article, March 23):

As a physician for 50 years, now retired, I applaud this article. It shines a bright light on the abuses by Medicare Advantage plans.

These plans, profit-making corporate entities, are focusing on their bottom line. The way to increase profits for a health insurance company is to collect premiums while delivering as little care as possible. These reverse incentives do not occur with original public Medicare.

When I was in private practice I saw how these Medicare “DisAdvantage” plans attracted patients with deceptive advertising but ended up hurting them, delaying or denying care by requiring prior authorization for expensive drugs or procedures.

We should get rid of Medicare Advantage plans. They add cost but no value to the system of health care for seniors. Unfortunately, lobbying money talks, and these very profitable corporate entities have deep pockets, which permit these abuses to continue. This is shameful.

In New York State, passing the New York Health Act would eliminate this expensive middleman and bring affordable health care to all New Yorkers.

Elizabeth R. Rosenthal
Larchmont, N.Y.