House progressive bill wants to take Medicare out of Medicare Advantage's name

New legislation from two House progressive lawmakers wants to change the name of Medicare Advantage (MA) to “alternative private health plan,” the latest criticism of the program ahead of open enrollment.

The Save Medicare Act (PDF), introduced Thursday by Reps. Mark Pocan, D-Wisconsin, and Ro Khanna, D-California, argues that MA plans mislead seniors. The introduction of the bill—right ahead of open enrollment that starts Saturday—shows that while MA traditionally has wide bipartisan support, there remains opposition among more progressive lawmakers. 

“Medicare Advantage is just private insurance that profits by denying coverage and the name is being used to trick seniors into enrolling. That’s not right,” said Khanna in a statement. “This bill will prevent these private insurers from labeling themselves as Medicare and allow us to focus on strengthening and expanding real Medicare instead.”

The legislation would relabel MA as alternative private health plans and significantly fine any insurer that uses Medicare in plan titles or advertisements. 

Pocan said in a statement that Congress should instead work on expanding traditional Medicare to include dental, vision and hearing benefits that are offered by MA plans.

“These non-Medicare plans run by private insurers undermine traditional Medicare,” he said. “They often leave patients without the benefits they need while overcharging the federal government for corporate profit.”

The bill doesn’t appear likely to make it through the House, where more than 80% of lawmakers recently wrote a letter signaling their support for the growing program. However, it underscores criticism that progressives have of MA, especially private insurers’ role in it and reports of overspending. 

Lawmakers cited a recent report from the Medicare Payment Advisory Commission (MedPAC)—which advises Congress on Medicare issues—that Medicare made at least $12 billion in overpayments to MA plans in 2020. 

The program has faced criticism from MedPAC and the Department of Health and Human Services Office of Inspector General over risk adjustment practices. Reports have shown that some insurers have unnecessarily increased patient diagnoses to inflate the risk scores of patients, which can lead to higher payments. MedPAC has previously recommended a 2% cut to risk adjustment payments to MA plans.

MA advocates counter that the program has lowered costs for seniors. 

"Medicare Advantage is how more than 29 million seniors and individuals with disabilities choose to experience the promise of Medicare today," said Mary Beth Donahue, president and CEO of the advocacy group Better Medicare Alliance. "Beneficiaries give the program a 94% satisfaction rate and save nearly $2,000 per year compared to fee-for-service Medicare, providing meaningful affordability and peace of mind in a time of inflation on household costs."

The bill is the latest criticism that progressives have lobbed at the program. Members of the House Progressive Caucus and Sen. Elizabeth Warren, D-Massachusetts, earlier this year criticized up-coding practices used by MA insurers and private equity’s role in the program. The plans are “doing it so they can make more money from Medicare, because that is how the system is set up,” Warren said during a hearing in February.