Biden Plan to Cut Billions in Medicare Fraud Ignites Lobbying Frenzy

As Dan Froomkin notes, “Health insurers are spending millions to protect their ability to overbill billions to the government. Doesn’t that make you angry?”  Reed Abelson and Margot Sanger-Katz report in the NY Times:

“How’s the knee?” one bowler asked another across the lanes. Their conversation in a Super Bowl ad focused on a Biden administration proposal that one bowler warned another would “cut Medicare Advantage.”

“Somebody in Washington is smarter than that,” the friend responded, before a narrator urged viewers to call the White House to voice their displeasure.

The multimillion dollar ad buy is part of an aggressive campaign by the health insurance industry and its allies to stop the Biden proposal. It would significantly lower payments — by billions of dollars a year — to Medicare Advantage, the private plans that now cover about half of the government’s health program for older Americans.

The change in payment formulas is an effort, Biden administration officials say, to tackle widespread abuses and fraud in the increasingly popular private program. In the last decade, reams of evidence uncovered in lawsuits and audits revealed systematic overbilling of the government. A final decision on the payments is expected shortly, and is one of a series of tough new rules aimed at reining in the industry. The changes fit into a broader effort by the White House to shore up the Medicare trust fund.

Without reforms, taxpayers will spend about $25 billion next year in “excess” payments to the private plans, according to the Medicare Payment Advisory Commission, a nonpartisan research group that advises Congress.

The proposed changes have unleashed an extensive and noisy opposition front, with lobbyists and insurance executives flooding Capitol Hill to engage in their fiercest fight in years. The largest insurers, including UnitedHealth Group and Humana, are among the most vocal, according to congressional staff, with UnitedHealth’s chief executive pressing his company’s case in person. Doctors’ groups, including the American Medical Association, have also voiced their opposition.

“They are pouring buckets of money into this,” said Mark Miller, the former executive director of MedPAC, who is now the executive vice president of health care at Arnold Ventures, a research and advocacy group. Supporters of the restrictions have begun spending money to counter the objections. . .

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