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medicare advantage
How Medicare Advantage Is Hurting Workers
How Medicare Advantage is hurting workers
Jul 03, 2025
In 2017, Gary Bent was notified that his healthcare benefits were changing. Mr. Bent, a retired professor who taught at the University of Connecticut, received his Medicare coverage through his former employer. Prior to 2017, Gary was covered by traditional Medicare and a supplemental MediGap policy (which covers the 20% of medical costs not paid by traditional Medicare). However, in 2017 the state of Connecticut and Bent’s union renegotiated healthcare benefits for retired employees and entered into a Medicare Advantage contract.
Medicare Advantage is a for-profit, privately administered healthcare plan which covers people over the age of 65, or who have qualifying disabilities. Unlike traditional Medicare—the widely popular, government-run healthcare program that has covered America’s seniors for nearly 60 years—Medicare Advantage is rife with complaints of delays and denials of care, restricted provider networks, and the usual shortcomings of a for-profit healthcare system.
Years later, in June of 2022, Gary Bent had a recurrence of melanoma in the form of a bleeding lesion in his brain. Following a brain surgery, his neurosurgeon recommended he stay at a specialty hospital that could provide intensive care during his recovery. Despite being accepted as a patient, his Medicare Advantage plan said he had to go to a different facility, which his daughter, Megan Bent, described as “substandard.”
While he was in the rehab facility, Gary’s Medicare Advantage provider attempted to discharge him three times; Megan and her mother, Gloria Bent, filed appeals each time, and were twice successful. However, after losing the third appeal, Gary was discharged from the facility. Once he got home, he had a fever and was experiencing neck pain; he had been discharged from the facility while infected with bacterial meningitis.
After being readmitted for another three weeks, he was again discharged from the hospital and remained at home under the care of Megan and Gloria until he passed away shortly after. Following Gary’s death, Megan and her mother learned that Gary’s care was denied by an artificial intelligence program used by his Medicare Advantage provider.
The Bent family’s story is one shared by many families throughout the country, and despite increased criticism of Medicare Advantage in recent years, a growing number of unions have agreed to—or been forced into—moving their retired members out of traditional Medicare with supplemental MediGap coverage and on to these privatized plans.
To address this issue, the Labor Campaign for Single Payer recently hosted a webinar titled “Medicare Advantage and the Privatization of Healthcare: What Unions and Workers Need to Know,” which featured remarks from AFA-CWA president Sara Nelson, Sen. Elizabeth Warren (D-Mass.), and Rep. Pramila Jayapal (D-Wash.). The webinar also included informative and important presentations from Rose Roach, national coordinator for the Labor Campaign for Single Payer and Dr. Belinda McIntosh, board member for Physicians for a National Health Program, as well as testimony from Megan Bent and another Connecticut retiree, James Russell, both of whom are activists with the health justice advocacy organization Be A Hero.
Rose Roach opened her presentation by stating that the organization “never want(ed) to shame a union or their workers.” In truth, negotiators at the bargaining table are in a difficult position when it comes to negotiating retiree health benefits. While traditional Medicare rarely subjects patients to prior authorizations and allows them to see virtually any provider in the country, the program alone only covers 80% of healthcare costs. Therefore, unions must negotiate the purchase of a supplemental (MediGap) policy in order to cover the other 20%, with the combined premiums costing hundreds of dollars a month.
Medicare Advantage plans, on the other hand, often have low- or zero-dollar premiums and include coverage for dental, vision, hearing, and prescriptions (though the value of these additional benefits is often much less than beneficiaries were led to believe). However, patients in Medicare Advantage regularly experience claim denials and are often restricted to seeing a narrow set of in-network providers to get care. Insurance companies seek to maximize their profits by minimizing the amount of care their beneficiaries receive. The long-term costs of having to pay out of pocket for expensive treatments that are often not covered under Medicare Advantage plans can leave retirees and their families under mountains of medical debt.
Union negotiators may embrace Medicare Advantage because they are not fully aware of the long-term costs to their retirees, and because it looks like an opportunity to save money on retiree healthcare, which increases their leverage to bargain for better wages and benefits for in-service workers.
Despite increased public attention to the shortcomings of Medicare Advantage plans, many negotiators do not have the full picture of what it means to enter into a Medicare Advantage contract, and so the Labor Campaign for Single Payer developed a White Paper that highlights many of the important differences between the two options and includes a list of questions for negotiators to ask at the bargaining table, which they hope will result in more informed negotiations and fewer retired union workers ending up on Medicare Advantage.
In her remarks, Sen. Warren asserted that the name “Medicare Advantage” is misleading, arguing that the program “isn’t part of Medicare at all, and certainly not an advantage.”
Congresswoman Jayapal, the lead sponsor of the Medicare for All Act in the U.S. House, urged the attendees to make this issue a top priority in the coming years, saying “we can’t end up with Medicare Advantage for All, we need Medicare for All, and we need your organizing, your mobilizing, and your collective power to fight back against the giant insurance companies that are trying to buy up and destroy the vital public program.”
Indeed, insurance companies like UnitedHealthcare are doing everything they can to increase funding for Medicare Advantage and get as many people on to their plans as possible, often through deceptive marketing tactics and aggressive lobbying campaigns. This is because Medicare Advantage is the leading driver of corporate profits in healthcare.
In 2024, the Medicare Payment Advisory Commission (MedPAC), and independent government commission tasked with advising Congress on Medicare policy, estimated overpayments to Medicare Advantage providers to be roughly $80 billion dollars every year, while Physicians for a National Health Program released a similar report that estimated overpayments could be closer to $140 billion dollars annually. Roach’s presentation analyzed the various ways in which Medicare Advantage providers receive more money than was intended, which include upcoding, favorable selection and deselection, and quality and county bonuses. Of greatest concern to lawmakers on both sides of the aisle is ‘upcoding,’ a term referring to the insurance industry’s fraudulent practice of applying diagnostic codes to a patient’s chart in order to charge the federal government more money.
Insurance companies like UnitedHealthcare are doing everything they can to increase funding for Medicare Advantage and get as many people on to their plans as possible...
Much has been written about upcoding in recent years, including a bombshell report from the New York Times in 2022. Despite this extensive level of news coverage, Secretary of Health and Human Services Robert F. Kennedy Jr. was seemingly caught off guard by a line of questioning from Congresswoman Alexandria Ocasio-Cortez (D-NY), who asked Sec. Kennedy whether he was aware of any ongoing investigations, led by the Department of Justice, into this nefarious corporate practice. Kennedy, befuddled, asked the Congresswoman what she was referring to when she claimed there were “80 million dollars” of overpayments in Medicare Advantage, to which Congresswoman Ocasio-Cortez had to clarify she said “80 billion dollars a year…billion, with a ‘b.’”
A centerpiece of the insurance industry’s public relations campaign to pressure the federal government to increase funding for Medicare Advantage is the claim that the program is solving the health equity gap among eligible Medicare beneficiaries. Studies funded by AHIP, the insurance industry’s biggest lobbyist, claim that Medicare Advantage is providing better care at lower cost to beneficiaries. Dr. Belinda McIntosh repudiated the industry’s claim with a detailed presentation highlighting disparate health outcomes among various racial groups, concluding that beneficiaries who are black, hispanic, or members of “the usual disenfranchised groups are being left with no choice but to accept an inferior product with major problems, that wealthier and more privileged Americans are less likely to accept.” Indeed, as Dr. McIntosh stated, Black and Hispanic beneficiaries were denied care at rates of 20% and 23% respectively by their Medicare Advantage plans, as compared to 15% of claims being denied for White beneficiaries.
While the world of health policy is often laden with statistics and figures, everyone has a story about the shortcomings of the American healthcare system. Stories like that of the Bent family ring true to millions of others, including James Russell, a retired academic who, like Gary, used to work for the state of Connecticut and is on a Medicare Advantage plan. During the webinar, Russell told his story of being diagnosed with stage IV lung cancer and having to seek treatment from a number of different providers in different corners of the country. Megan, Gloria, and James shared their stories and discussed their collaborative work to fight for a better healthcare system as part of their work with Be A Hero.
While the world of health policy is often laden with statistics and figures, everyone has a story about the shortcomings of the American healthcare system.
The Labor Campaign for Single Payer is demanding that the federal government “level the playing field” between traditional Medicare and Medicare Advantage. While the former is constantly under financial strain, the latter benefits from unchecked corporate handouts to insurers, who then increase their profits at the expense of patients by delaying and denying care. Just as is the case when a union negotiator is in a difficult position in picking between traditional Medicare and Medicare Advantage, so too are individual beneficiaries, who must either pay hundreds of dollars a month in premiums for traditional Medicare and a supplemental policy, or instead sign over their Medicare benefits to an insurance corporation that does not care about them. In order to “level the playing field” between traditional Medicare and Medicare Advantage, activists and lawmakers seek to expand traditional Medicare to cover vision, dental and hearing, as well as to set an out-of-pocket-cap on healthcare spending by beneficiaries, which could reduce the necessity of a MediGap policy and thereby reduce the monthly premiums of traditional Medicare.
The Labor Campaign for Single Payer encouraged attendees of the webinar to go to their unions and pass a resolution stating support to level the playing field, which has passed at conventions of the Washington State Labor Council AFL-CIO, the Minnesota AFL-CIO and the Maine AFL-CIO. Additionally, organizers of the webinar encouraged attendees to review and utilize their White Paper to discuss Medicare and Medicare Advantage with their fellow workers and union’s leadership and plan a bargaining strategy that pushes back on the claim that Medicare Advantage is a “win-win” solution to the problem of the high cost of retiree healthcare.
The White Paper, the resolution and the recording of the June 18 Webinar are available on the Labor Campaign for Single Payer’s Resources page, along with a variety of other educational resources on Medicare Advantage and the fight to guarantee healthcare to all workers and people.Keep ReadingShow Less
NY Court Ruling Will Force Retired Workers Into Privatized, For-Profit Medicare Advantage Plans
"Nobody will ever want to work for New York City again. Zero trust. Medicare Advantage is a bait and switch scam & betrayal. Enough!" wrote one New York City councilmember.
Jun 19, 2025
New York State's highest court on Wednesday ruled against city retirees who had sought to block an effort by Mayor Eric Adams' administration to move them onto a for-profit, privatized Medicare Advantage plan.
In a unanimous decision, New York Court of Appeals Judge Shirley Troutman wrote that petitioners in the case are not entitled to "promissory estoppel" cause of action, the argument that the retirees throughout their employment with the city were promised traditional Medicare benefits when they retired.
According to Gothamist, "the court also ruled that the retirees did not have a legally binding promise from the city that their coverage would remain unchanged." The Wednesday ruling overruled a state Supreme Court judge’s decision that had prevented the Adams administration from making the switch, though the Court of Appeals said there were still issues in the case that should be sent back down to the Supreme Court, a lower court in New York's state system.
Medicare Advantage plans are run by private health insurers who receive money from the federal government to provide Medicare-covered services. Medicare Advantage enrollment around the country is growing, though the Medicare Advantage system has been accused of offering poor care and boosting corporate profits. A 2022 investigation by The New York Times found that major health insurers have exploited Medicare Advantage to juice their profits by billions of dollars.
The move to switch the city's 250,000 retirees to Medicare Advantage stems from a 2018 agreement between leaders in city government and major public employee unions to cut $600 million from the city's healthcare spending, according to the outlet The City.
"While we are disappointed in the ruling by the Court of Appeals, the solution to protecting seniors' healthcare has always been with the City Council and the mayor," said Marianne Pizzitola, leader of the Organization of Public Service Retirees, which opposes the switch.
"The City of New York should never, ever be screwing over retirees—and neither should the courts. Nobody will ever want to work for New York City again. Zero trust. Medicare Advantage is a bait and switch scam & betrayal. Enough! City Hall clearly doesn't care about retirees," wrote Justin Brannan, New York City Council Finance Committee Chair and Democratic candidate for city comptroller, in response to the ruling.
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We've Endured a Half-Century of Kleptocrats' Plunder of People's Wealth and Health
Neoliberalism has spurred 45 years of financialization, as Wall St. pillages-for-profit every sector, from healthcare to housing.
May 21, 2025
The Franklin D. Roosevelt administration prioritized a standard for economic and democratic empowerment of the people. FDR's New Deal advanced the common good and an economy for the people. The 1935 Social Security Act became the boilerplate for universal healthcare.
The post-WWII "Golden Age" of capitalism boosted economic growth, people's prosperity, and middle class expansion, lasting until 1975—subsequently displaced by global neoliberal capitalism.
Principle Political Dichotomy: Corporatists vs. Working People
Since the 1970s white supremacists, Christian nationalists, and aspiring oligarchs have converged under the Republican Party umbrella to seek deconstruction of democracy toward harnessing wealth and political power, while promoting supremacist entitlement—the presumed right to criminalize and hold hostage other people's lives based on gender, ethnicity, religion, and class wealth.
Nixon Supreme Court appointee Lewis Powell's 1971 Memorandum, termed a "capitalist coup," further galvanized corporate money toward rewrite of law, policy, and judicial precedent to consolidate corporate political power.
Since Reagan, continual huge tax cuts for wealthy corporatists have spiked national deficits, paid for with deficit-cutting on the backs of working people by cutting public and social programs.
Kleptocracy, also known as "socioeconomic thievery," describes the half-century robbery of the American people by corrupt leaders who expropriate wealth of the governed for their own gain. Contemporary Gilded Age Robber Barons continue to expropriate people's wealth. A RAND Corporation Report reveals that from 1975-2023 the top 1% robbed $79 trillion from the bottom 90%. Had earnings remained equitably distributed at pre-1975 levels, the average worker in the bottom 90th percentile would earn $32,000 more annually.
Even as the neoliberal "greed is good" ethic prioritized enhancement of shareholder profits, Reagan administration neoliberalism supercharged wealth transfer upward, crushing unions and wages, gutting antitrust law, deregulating banks and industries, enabling predatory private equity practices, and legalizing stock buybacks that continue to multiply billionaires' wealth.
Neoliberalism has spurred 45 years of financialization, as Wall St. pillages-for-profit every sector, from healthcare to housing. Kleptocrats leverage rivers of dark money to capture media and dominate lobbyist-controlled legislatures and elections, flooding the 2024 election with nearly $2 billion.
Commodification of Health for Profit Betrays the Original Intent of Medicare
The Social Transformation of American Medicine, by sociologist Dr. Paul Starr is a Pulitzer Prize-winning chronicle of corporate takeover of U.S. healthcare. Starr describes former President Richard Nixon as the first mainstream political leader to "take deliberate steps to change American healthcare from its longstanding not-for-profit business principles into a for-profit model to be driven by the insurance industry."
A 1971 video exchange between President Nixon and his aide John Ehrlichman celebrated the Kaiser CEO's prioritization of profit over healthcare. Enthused Ehrlichman, "...All the incentives are toward less medical care, because the less care they give them, the more money they make."
Ostensibly intended to cut costs and improve healthcare access, Nixon's 1973 HMO Act advanced the concept of for-profit "managed care" health models. Each manifestation of managed care, including Accountable Care Organizations and Medicare Advantage, have proved increasingly profitable for Wall St. and the health industrial complex.
With passage of the 2003 Medicare Modernization Act, former President George W. Bush spearheaded privatized, for-profit Medicare Advantage insurance, purportedly written to "compete" with Original Medicare to save costs and improve healthcare access. Failing to do either, Medicare Advantage betrays the original intent of Medicare—to universalize coverage and rein in health costs with transparent pricing. Medicare Advantage plans often lack data and compliance information, while payment rates are manipulated based on a complex "risk modeling" process.
The Center for Economic and Policy Research reports: Even as Medicare Advantage insurers' profits are inflated, quality of patient care is reduced.
The United States remains an outlier—the only developed nation lacking universal healthcare, the only nation that places profiteering middlemen between patients and their doctors.
Since Reagan, continual huge tax cuts for wealthy corporatists have spiked national deficits, paid for with deficit-cutting on the backs of working people by cutting public and social programs. The 2025 Republican reconciliation bill promotes enormous tax cuts for the wealthy, and huge cuts to Medicaid and SNAP programs.
Were House Republicans serious about cutting "waste, fraud, and abuse," instead of cutting Medicaid coverage for 8.7 million people, they would eliminate Medicare Advantage scams that bleed $140 billion in annual overpayments from the Medicare Trust Fund—invested in as a lifetime earned benefit by every U.S. worker. Fraudulent "upcoding" exaggerates patient health conditions, costing $23 billion in 2023 overpayments. Some Medicare Advantage plans employ AI or a computer algorithm to instantly deny payments—reportedly used by Cigna to deny over 300,000 requests for payments in 2022.
Rigged to maximize government overpayments to pad shareholder and CEO profits—ultimately to privatize Original Medicare—Medicare Advantage overpayments are funded by taxpayers and Medicare Advantage and Traditional Medicare enrollees, who pay, among other costs, increasing Medicare Part B premiums annually—totaling $13 billion higher premiums in 2024.
A physician-authored report advises: "The time has come to declare Medicare Advantage a failed experiment and abolish it." Taxpayer overpayments to Medicare Advantage should instead go to boost an economy and healthcare for the people by eliminating profit-maximizing insurance middlemen. At least 22 studies report annual $600 billion Medicare for All administrative savings, enough to extend comprehensive health coverage to all ages.
A 2018 economic analysis by UMass Amherst Economists concluded that Medicare for All would significantly improve healthcare outcomes, and reduce healthcare spending by nearly 10%—from approximately $3.24 trillion to approximately $2.93 trillion. Additional projected annual prescription drug savings total $200-$300 billion.
Washington Complicity in Half-Century Privatization of Medicare
Further boosting privatization of Medicare, the Centers for Medicare and Medicaid Services' (CMS) "innovative payment" experiments, modeled on "Managed Care" Accountable Care Organizations, were written into the Affordable Care Act. The Congressional Budget Office reported in 2023 that CMS experiments with "value-based" ACO payments failed to control costs, improve quality, or increase equity, costing Medicare $5.4 billion more than it saved during its first decade.
Medicare for All Would Vitalize an Economy for the People
The United States remains an outlier—the only developed nation lacking universal healthcare, the only nation that places profiteering middlemen between patients and their doctors. U.S. healthcare spending since 1980 outpaces other nations, and demonstrates "by far the worst overall health performance."
Only Single-Risk-Pool Medicare for All can leverage cost-savings of global health budgets to achieve financially sustainable, universal, comprehensive healthcare, while greatly reducing the 30% administrative costs of thousands of fragmented Medicare Advantage plans. The newly introduced Medicare for All Act of 2025 would eliminates out-of-pocket costs—premiums, copays, and deductibles—and unnecessary supplemental plans—Medicare Parts A, B, C, D, and Medigap.
For the first time in almost a century prioritization of universal health coverage would eliminate profiteering middlemen, boosting an economy that serves working people—not the ballooning billionaire kleptocracy.
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