Medicare Advantage Bribery Scheme Highlights 'Bad Behavior' Trump Wants to Reward

Healthcare advocates have long condemned the for-profit insurance companies that manage Medicare Advantage plans for overbilling the federal government by hundreds of billions of dollars per year, using artificial intelligence and algorithms to deny patients' claims, and tricking patients with disabilities via deceptive marketing practices—and a lawsuit originally initiated by a whistleblower is accusing three such private insurance giants of taking part in overt bribery.

The U.S. Department of Justice filed a complaint Thursday under the False Claims Act, accusing three of the largest Medicare Advantage insurers—Aetna, Humana, and Elevance Health—of paying brokers hundreds of millions of dollars to steer beneficiaries toward their plans, and to steer disabled seniors away in an effort to keep them more profitable.

The American Economic Liberties Project (AELP) noted that the lawsuit comes from an unlikely place—the Trump administration, which last month announced it would substantially increase payments to the privately run plans, increasing rates to the tune of $25 billion in additional funds next year despite their history of defrauding the government and patients.

While applauding the DOJ for cracking down on the bribery scheme, the group noted that "despite its promises to crack down on such wasteful spending, the Trump administration recently announced it would substantially increase payments to private Medicare Advantage plans in 2026, rewarding their bad behavior."

Dr. Mehmet Oz, who President Donald Trump appointed to lead the Centers for Medicare and Medicaid Services, has also advocated for a proposal called Medicare Advantage for All—further expanding the for-profit plans that now cover more than half of Americans who are eligible for Medicare.

"For years, these firms have driven seniors into worse care with deceptive marketing and discrimination, but now it's clear they're crooks too."

The lawsuit filed Thursday also named three brokers—eHealth, Inc., GoHealth, Inc., and SelectQuote Inc.—and said that between 2016-21, the companies "paid hundreds of millions of dollars in illegal kickbacks to the defendant brokers in exchange for enrollments into the insurers' Medicare Advantage plans."

The brokers are accused of directing beneficiaries to the plans that paid them the most in kickbacks, regardless of the suitability of the plans. They also allegedly provided their employees with incentives to sell plans based on the payments from the three insurers and refused to sell Medicare Advantage plans for the three companies if they didn't pay the brokers sufficiently.

Aetna and Humana are also accused of conspiring with the brokers to "discriminate against Medicare beneficiaries with disabilities whom they perceived to be less profitable," threatening to withhold payments unless brokers enrolled fewer disabled senior citizens.

"Private Medicare Advantage plans routinely fail to deliver quality care—especially for seniors and the most vulnerable—and are among the most wasteful, fraudulent, and abusive actors in our healthcare system," said Emma Freer, senior policy analyst for healthcare at AELP. "For years, these firms have driven seniors into worse care with deceptive marketing and discrimination, but now it's clear they're crooks too—bribing brokers behind closed doors because they know no one would choose these plans on a level playing field."

In addition to cracking down on the bribery scheme, Freer called on Trump's DOJ to "move swiftly on its ongoing monopolization and fraud investigations in the largest Medicare Advantage plan provider, UnitedHealth Group."

The DOJ opened an investigation in February into UnitedHealth's effect on competition in insurance, pharmacy benefit management, physician networks, and other sectors of the for-profit healthcare industry.