During the continuing resolution fight, the drum the Democrats kept beating was that Republicans wanted to gut Medicare - despite the fact that Joe Biden's administration oversaw years of cuts to Medicare Advantage, the plan increasingly chosen by the nation's seniors. Dems won't characterize cuts to Medicare Advantage as Medicare cuts, though, because what they're really trying to do is eliminate Medicare Advantage as a way to push "Medicare for All."
Now that we're headed into the reconciliation process, where finding ways to keep Medicare solvent will be a top issue, at least one lefty is on record admitting that cutting Medicare Advantage really does equal cutting Medicare - and we have to keep reminding them of that.
RELATED: Democrats Are Again Lying About Supposed Medicare/Medicaid Cuts in the Budget CR
The Backstory:
Medicare Advantage is an alternative to traditional "fee for service" (FFS) that offers additional benefits and more comprehensive medical care management, and is now used by more than half of Medicare enrollees, according to the Kaiser Family Foundation. Because it gives more choice and flexibility, the Bernie Sanders/Elizabeth Warren wing of the Democrat party don't like it one bit, and ensured that there were cuts to the program in both 2023 and 2024 - claiming that it is too costly.
As Biden staffers were on their way out the door they instituted a de facto third round of cuts, in the form of "underfunding and arcane rule-making," as Saul Anuzis writes at Washington Examiner. But, as Anuzis says, Team Biden also hosed Medicare Advantage enrollees in other ways:
Biden and congressional Democrats’ signature “Inflation Reduction Act” contained policies that resulted in a 39% hike in seniors’ Medicare Part D premiums. Biden and his coterie of advisers knew that was a huge liability heading into a close election where seniors are the most reliable voting bloc. So, his administration decided to take money out of Medicare Advantage to stabilize the stand-alone Medicare Part D market, resulting in less funding for Medicare Advantage in favor of original Medicare.
Now, Trump is left to govern in a situation where bad Biden policy has left those 54% of eligible enrollees who use Medicare Advantage facing a program even more drained of resources. In and of itself, that’s bad. But it’s even worse when you consider that Medicare Advantage is better for taxpayers and entitlement solvency than traditional Fee-for-Service Medicare.
Now, What?
During the budget continuing resolution fight, Democrats went full "Republicans are trying to cut Medicare and hurt poor people and push Grandma off a cliff," as usual. They left out the part where they and a few squishy Republicans (Sen. Bill Cassidy and Rep. Greg Murphy) are actively trying to cut Medicare by cutting Medicare Advantage - and they'd cut Medicare Advantage altogether if they could, relying on flawed studies from lefty think tanks and a politicized Medicare Payments Advisory Committee (MedPAC).
In reconciliation, Warren and crew will push for "changes" to Medicare Advantage, demonizing insurance companies and avoiding that other C word - cuts. (There's a lot to criticize there, to be sure, but there's a lot more fraud and waste in traditional Medicare.) Unfortunately, a "health policy expert" at Brookings Institute, one of those lefty think tanks creating anti-Medicare Advantage white papers, admits that they're pushing for cuts, but argues they're "good" cuts. From Axios:
- Republicans are already facing blowback over potential cuts to Medicaid, and adding Medicare would be even more politically dangerous, even if the changes in question are favored by many policy experts.
- "This is the Willie Sutton thing, right? This is where the money is," said Loren Adler, a health policy expert at Brookings, referring to MA.
- The political challenge, though, is that "the other party can say you cut Medicare without differentiating between, you know, good versus bad cuts," Adler added.
What about those criticisms of Medicare Advantage as costly? They're based on flawed studies that overemphasize some distinctions between MA and traditional Medicare, and ignore other distinctions. To describe it here would really get into the weeds, but when all of the variables are accounted for and properly weighted, numerous studies have shown that Medicare Advantage is both more cost-effective than traditional Medicare and leads to better outcomes for enrollees. A 2024 study from Elevance Health found:
In the last decade, growth in total Medicare program spending has been slower than predicted while Medicare Advantage (MA) enrollment has grown significantly.
This study found that higher MA penetration (i.e., percent enrolled in MA) is associated with lower total Medicare spending per capita, both across U.S. counties and year-over-year within a county.
In comparison to if MA penetration had stayed constant at 2011 levels, cumulative savings in total Medicare spending from 2012-2021 are estimated to be as high as $144 billion (in 2021 dollars).
If you're interested in those deeper dives, I recommend this piece from Health Affairs, this analysis from Avalere, and this analysis from FTI (published on industry advocacy group AHIP's website).
AHIP president Mike Tuffin told Axios:
"Thirty-four million Americans choose Medicare Advantage because it's far more affordable and delivers better outcomes than fee-for-service. We welcome the opportunity to build on the compelling success of Medicare Advantage and strengthen the program for the future."
Elizabeth Warren, Bill Cassidy, and Greg Murphy need to be clear with the American people that instead of proposing true accountability and the elimination of fraud and waste in Medicare/Medicaid, they're proposing cuts that would cause real harm to a majority of Medicare enrollees.
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