Chairman of Energy and Commerce says Medicare Advantage marketing practices are disgraceful

June 26, 2007 – A House subcommittee hearing today opened with a blistering statement of charges and penetrating questions from Democratic Congressman John D. Dingell, Chairman of the Committee on Energy and Commerce. The hearing, held by the Subcommittee on Oversight and Investigation, was entitled Predatory Sales Practices in Medicare Advantage.

Dingell opened with, “I’ll be blunt. The Medicare Advantage marketing practices that have come to the attention of this Committee are disgraceful. But frankly, they come as no surprise to those of us who have long questioned the structure of the Medicare Advantage program.”

Included among his questions were –

   ● Why are Medicare payments for Medicare Advantage beneficiaries, on average, 12 to 50 percent higher than what Medicare pays for beneficiaries enrolled in traditional Medicare?

   ● Why should the vast majority of traditional Medicare beneficiaries pay higher monthly premiums to subsidize Medicare Advantage enrollees?

   ● Wasn’t privatization supposed to help contain costs and allow more efficient delivery of quality health care?

Dingell said he does not believe Medicare Advantage is containing costs and “there’s no evidence that it is providing value to beneficiaries commensurate with its greater cost.”

“On the contrary,” he added, “as we’ll hear today, the very structure of Medicare Advantage creates conditions ripe for swindling the elderly and disabled.

“The real beneficiaries of this program are the insurance companies, which have profited handsomely—Humana will reportedly earn 66 percent of its net income from sales of Medicare Advantage products this year.”

Full Article and Source:
Rep. Dingell Blasts Medicare Advantage Plans’ Sales
Tactics at Hearing