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Informing the Debate about Curbing Medicare Advantage Overpayments

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Publication Date: May 2008

Publisher(s): Center on Budget and Policy Priorities (Washington, D.C.)

Author(s): Edwin Park

Special Collection: John D. and Catherine T. MacArthur Foundation

Topic: Health (Health services for older people)
Health (Health care financing)

Keywords: Economic projections; Health insurance; Health care costs; Retirement

Type: Report


Bipartisan Senate negotiators are now working on the details of Medicare legislation that would avert a cut in physician payments scheduled to take effect at the end of June. This legislation could also serve as an opportunity to curb, at least to a modest extent, overpayments to private insurance plans that participate in the Medicare Advantage program; doing so could offset, in full or in part, the cost of that legislation. There continues to be significant confusion, however, about these overpayments, the benefits that Medicare Advantage plans offer, who enrolls in those plans, and the marketing practices some of those plans employ. Adding to this confusion, some material on these matters being disseminated by the health insurance industry presents data very selectively and makes dubious claims.

This primer uses a question-and-answer format to clear up possible misunderstandings or confusion on various issues related to private plans that participate in the Medicare Advantage program. The primer is intended to help inform the debate on these issues.