April 21, 2022

ICYMI: Warren, DeLauro, Schakowsky, Porter Lead Letter Calling on CMS to Address Overpayments and Increase Transparency in the Medicare Advantage Program

Text of Letter (pdf)

WASHINGTON, DC – Senator Elizabeth Warren (D-Mass.) and United States Representatives Katie Porter (D-Calif.), Rosa DeLauro (D-Conn.), and Jan Schakowsky (D-Ill.) led their colleagues in sending a letter to Centers for Medicare & Medicaid Services Administrator Chiquita Brooks-LaSure highlighting concerns about overpayments to Medicare Advantage plans that line the pockets of big insurance companies. The letter urges CMS to mitigate the announced payment increases so they are on par with payments to Traditional Medicare. Sent by a total of 19 members of the Senate and the House, the letter also calls on CMS to increase transparency in the Medicare Advantage program.

“The record profit margins of health insurers participating in the Medicare Advantage program in 2021 indicate that insurance companies are generating significant revenue from excess Medicare Advantage payments,” wrote the lawmakers. “Unless CMS addresses overpayments, public funds will continue to finance private profits at the expense of taxpayers, as well as older adults and disabled individuals on Medicare.”

The lawmakers highlight that excess payments threaten the Medicare Hospital Insurance (HI) Trust Fund. They also emphasize that Medicare Advantage plans spend less on care while taxpayers pay more.

“Even though Medicare Advantage plans claim to provide full Medicare benefits for less money than what it costs the government to provide those benefits through Traditional Medicare, Traditional Medicare remains more cost-effective. Medicare Advantage coverage was originally designed to achieve savings by paying insurers rates set at 95 percent of those used by Traditional Medicare. But Medicare Advantage has failed to achieve savings in any year since its inception,” added the lawmakers. “Given our concerns, we urge you to reconsider the decision to finalize policies that will increase payments for insurers in the Medicare Advantage program at the cost of taxpayers, traditional Medicare beneficiaries, and the Medicare HI Trust Fund. We look forward to working with you on other ways to ensure greater transparency and value in the Medicare Advantage program.”

Senator Warren, DeLauro, Schakowsky, and Porter were joined by Senators Sherrod Brown (D-Ohio.), Bernie Sanders (I-Vt.), Patrick Leahy (D-Vt.), and Cory Booker (D-N.J.), and Representatives Mark Pocan (D-Wis.), Pramila Jayapal (D-Wash.), Raúl M. Grijalva (D-Ariz.), Sheila Cherfilus-McCormick (D-Fla.), Judy Chu (D-Calif.), Jesús G. "Chuy" García (D-Ill.), Jahana Hayes (D-Conn.), Debbie Dingell (D-Mich.), Cori Bush (D-Mo.), Mondaire Jones (D-N.Y.), and Rashida Tlaib (D-Mich.).