Trump Administration Raises Payments and Predicts Medicare Advantage Plans to Hit 50% of Beneficiaries

We are in the Medicare open enrollment period until December 7th and seniors and persons with disabilities are getting a barrage of advertising in their mail, email and in television and newspaper ads.   Medicare has become more profitable for these private and nonprofit health plans in Medicare with the government boosting their payments by 3.45% for 2019.  There are now 3700 such local and regional plans across the nation.   The Trump Administration is predicting up to 50% of beneficiaries will soon choose these plans.  About 23 million Medicare beneficiaries are predicted to be in Medicare Advantage in 2019.  This has become a very confusing exercise for many beneficiaries unless they decide to simply stay with original Medicare and can have their choice of doctors and providers.

The Advantage plans though are trying to entice beneficiaries with $0 monthly premiums, gym memberships  and some dental and hearing aid costs covered along with other perks.  How do they do this?  They try to attract healthier persons and have a restricted network of providers.  They also have prior authorization rules for some treatments   In fact, a recent report from the Office of Inspector General at the Department of Health and Human Services says it has found “widespread and persistent problems related to denials of care and payment” in the Medicare Advantage program.  It found that 75% of appeals were overruled though most people do not appeal or know how to.

The Medicare Care Advantage market nationwide  is dominated by Aetna, Humana and United Healthcare but there are many smaller and more regional insurers.  10,000 persons are turning 65 every day and they are more accustomed to having managed care coverage from private employers.  With government funding increasing many insurers are entering the Medicare market and the three dominant companies plan to expand into 97 more counties nationwide.  The for profit companies are reportedly making a profit margin that is double that of other nonprofit Medicare Advantage plans.

Progressive activists are continuing to push for a Medicare for All single payer plan nationwide to extend health coverage to all Americans and cut into the overhead and profit of private insurers.


Gov. Cuomo Issues Executive Order to Include Age Friendly, Population Health, Smart Growth Principles in State Policies

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Here is a partial text from the Governor’s press release

On November 15, Governor Andrew M. Cuomo  issued an executive order that directs state agencies to include New York State Prevention Agenda priorities and the AARP/World Health Organization eight domains of livability for age-friendly communities, where appropriate, into federal and state plans, and agency policies, procedures, and procurements.   

“New York is committed to creating thriving communities that support and attract people of all ages, and this executive order will continue to maximize our efforts as the first age-friendly state in the country,” Governor Cuomo said. “Incorporating age-friendly smart growth principles into the fabric of state government will support community development and improve the health and quality of life of all New Yorkers.”  Several communities in New York State including Albany County are part of the WHO/AARP age friendly initiative in their communities.  Albany County will be issuing an interim report in January on its project which began in 2016.

“Here in New York, we are proud of how we invest in New Yorkers at every stage of life,” said Lieutenant Governor Kathy Hochul. “Our commitment to older adults is unprecedented, and as more and more people live longer, fuller lives it becomes increasingly essential to ensure their needs are met and that they’re active in their communities. As the nation’s first age-friendly state, we are committed to incorporating health needs and smart growth initiatives among all State agencies to ensure all New Yorkers lead their best lives.”

The executive order further promotes the Governor’s Health Across All Policies approach, which directs diverse state agencies to work together to improve population health, promote healthy aging, and assist localities in planning and implementing elements to create age-friendly communities.

Under Governor’s Cuomo’s leadership, New York was declared the first age-friendly state in the nation in 2017 by AARP and the World Health Organization.

The goal of incorporating age-friendly concepts into government contracting and procurement opportunities is to create and foster healthier, more integrated communities that allow New Yorkers of all ages to easily receive services, take part in, and move around their community. Targeted actions and investments consider or provide preference to age-friendly concepts, which include supporting healthy aging and aging in place, and supporting new business and procurement models for areas such as housing, construction, and information technology. These are achieved through system level changes, such as offering incentives for age-friendly concepts, establishing new procurement guidelines and financing models, or implementing regulatory changes.

Since 2011, Governor Cuomo has worked to make New York State more livable, sustainable and equitable for people of all ages. Over the past seven years, New York has become a national leader in creating clean, livable, and sustainable communities by pioneering multi-faceted programs that support aging in place, coupled with an unparalleled suite of smart growth reforms that directly support the eight domains of livability:

  • Since signing the Complete Streets Act in 2011, 12 counties and more than 100 villages, towns, and cities have adopted Complete Streets policies to consider the safe, convenient access and mobility of all roadway users of all ages and abilities.
  • Through the Livable NY initiative, the state has been working with municipalities to provide technical assistance for planning decisions around livability.
  • As part of the Governor’s landmark affordable housing plan, New York State will invest $125 million to develop or rehabilitate affordable housing targeted to low-income older New Yorkers, aged 60 and above.
  • As part of the Downtown Revitalization Initiative, New York State has awarded $300 million to 30 downtown areas to date, prioritizing awards to municipalities that have age-friendly policies in place.
  • In 2017, the New York State Office for the Aging created the nation’s first statewide aging services mobile app to connect older adults and caregivers with easily accessible material about benefits, programs, and services, including information regarding health and wellness, housing, and transportation options.
  • Since signing the NYS Land Banks Act in 2011, New York State has created 25 land banks and is now a leader in fighting blight, vacancy and abandonment in underserved and distressed communities.

New York State Office for the Aging Acting Director Greg Olsen said, “Communities that understand and adopt age-friendly, smart growth principles thrive by attracting new residents to New York and retaining others, including the growing older adult population. Older New Yorkers are a vital part of their communities, contributing economically, socially, and intellectually through volunteerism, civic engagement, employment, and tourism.

Blue Wave Rolls Over New York, Wiping out State Senate Majority; Democrats Defeat Three GOP Members in House

New York State turned a deeper shade of blue on Election Day as Democrats, which needed one seat to take over the New York State Senate won eight seats.   They now will have a majority of 40 members with Republicans having only 23.   About one fourth of the Senate members will be new after the election.   It will be very difficult for Republicans to regain control of the Senate anytime soon.

Assembly Democrats continue to hold a dominant majority.  Governor Cuomo and Comptroller Thomas DiNapoli were re-elected easily along with the new Attorney General, Democrat Latitia James.   Senator Kirsten Gillibrand won 66% in her re-election bid and she already said she is considering running for President in 2020.

Victories for the Democrats mean that Senator Andrea Stewart-Cousins of Westchester will become the new Senate Majority Leader, the first woman and African American in that position.   Outgoing Majority leader John Flanagan  may face competition for the position of Minority Leader.  The Republicans had nine members in the Senate from Long Island but will have only three now so upstaters may want one of their own to lead the GOP.

Many familiar faces who have been in Albany for decades will be gone including Senators Kemp Hannon, Martin Golden and Carl Marcellino who were all defeated.  Others including Jeff Klein, Tony Avella, David Valesky, Marisol Alcantara and Jose Peralta, who were members of the Independent Democratic Caucus were defeated in September primaries after a rebellion by progressive Democrats.   Others who retired and not coming back are John DeFrancisco, John Bonacic, Bill Larkin and Kathy Marchione.  The new Senate Democratic Majority will be much more diverse than the Republicans who ran the chamber.

Hannon had chaired the Health Committee for many years and now there will be a new Democratic chair.   Senator Gustavo Rivera has been the ranking member of that committee but it is unclear if he will become Chairman of the committee.   Others with more seniority may want that high profile position.  Senator Sue Serino who has been chair of the Aging Committee was re-elected but will no longer be chair.  Usually, a Senator without a lot of seniority becomes chair.  It would be ironic if new Senator Alessandra Biaggi, who defeated Jeff Klein becomes Aging Chair.  Her grandfather, Congressman Mario Biaggi, was the legendary first Chair of the Aging Committee in the US House of Representatives forty years ago.

Meanwhile, Democrats won three seats in Congress in New York, leaving Republicans with only six of the state’s 27 seats.    Democrat Antonio Delgado defeated John Faso in a seat in the Mohawk and Hudson Valleys.  Assemblyman Anthony Brindisi ousted Claudia Tenney in central New York and Max Rose defeated Daniel Donovan on Staten Island, meaning there will no longer be any Republicans from New York City in the House of Representatives  Indicted Congressman Chris Collins was re-elected in western New York.  Other remaining Republicans are Peter King and Lee Zeldin on Long Island and Elise Stefanik from northern New York, John Katko from central New York and Thomas Reed of the Southern Tier.

Drug Companies Fear Trump Actions to Lower Costs and a Possible Alliance with Democratic House

As he campaigns in Congressional races, President Trump has ramped up his rhetoric and his plans to lower prescription costs, a position he took during his presidential campaign but has yet to deliver on in a big way.   Now, he and the Health and Human Services  Secretary for the first time are proposing using prices from other countries as a basis for determining costs for drugs in Medicare.   However, this plan only relates to drugs under Medicare Part B given in doctors’ offices rather than the broader Part D drug program for medicine received at a pharmacy.

Trump is also proposing that drug companies be forced to advertise the cost of their drugs publicly.  The pharmaceutical industry is pushing back saying listed prices are not paid by most consumers since rebates are given to insurance plans which then charge co-pays to customers to pay part of the costs.  Another bill that has passed both houses ends the gag rule imposed by pharmacy benefits managers which forbids pharmacists from telling patients they can get lower prices at the pharmacy counter by paying cash and not using their insurance for some low cost drugs.  This bill does not cover prices for generic drugs though.

Democrats have been pushing for years for Medicare to negotiate systemwide on the price of drugs.  The Trump Administration and Republicans in Congress have rejected that approach as hurting pharmaceutical companies research and developments costs.  Trump’s  fixation on international trade deals has made drug prices a target because he sees the US footing the entire bill for development costs and not getting the cost break that other countries do through negotiated  prices by their national health plans.

It is really unclear if Trump will work hard to push these new pricing and advertising plans beyond the election.  He seems to be offering many different ideas like a new tax cut, this drug plan and others just to get attention for voters during the campaign.  However, even if he doesn’t push his own plans,  the pharmaceutical industry is  worried that Trump will team up with Democrats if they take control of the House of Representatives and agree on a broad plan to lower prices related to other countries or allow negotiation on drug prices for Medicare.

I have said for a long time that the pharmaceutical industry only has itself to blame for this predicament as it has engaged in setting exorbitant prices for insurance plans and customers by charging whatever they can get away.   Politicians have been literally paid off by huge campaign contributions and they have refused to intervene to protect the public.  There are too many sweetheart deals and loopholes that allow higher profits to be shared by pharmacy benefits managers and drug companies.   Some in Congress say that government should not interfere in the pricing of drugs but they forget that the government is one of the biggest payers of health care in the country and it already negotiates prices for the Veterans Administration and other programs.

Surprise, Surprise: GOP Leaders in Congress Say Cuts in Social Security, Medicare Needed as Deficits Grow

Here we go again.  Less than a year after passing a huge tax cut that primarily benefits businesses and the wealthy, Republican Congressional leaders are saying again that the cause of the quickly growing  federal deficit is spending on Social Security and Medicare.  It’s just amazing they have the gall to target these programs again just before the midterm elections.   They are giving Democrats all the ammunition they need to urge voters to elect them to prevent cuts in the programs.   Democrats are planning campaign advertising  to highlight statements made by Senate Majority Leader Mitch McConnell calling for budget cuts to reduce the deficit.

Some Republicans claimed the tax cuts would generate so much economic growth and tax income that they would practically pay for themselves.  The Congressional Republicans have another problem:  Donald Trump doesn’t agree with their desire to cut the programs and has not mentioned support during the fall campaigns.

Medicare and Social Security are needed more than ever now and provide a middle class retirement for many older persons.  Some might not have had significant other savings for retirement.  After years of paying into Social Security, workers are pleased when they finally have a guaranteed retirement income that averages about $1400 monthly for those retiring at 66, currently the full retirement age.

Republican plans for Medicare include a voucher plan in the future that would require beneficiaries to pay more out of their pockets for health care.   If Democrats gain control of the House they will be able to stop any attempted cuts in the Social Security and Medicare and stop many of the other budget cuts proposed by the Trump Administration.

HHS Inspector General Says Medicare Advantage Plans Guilty of “Widespread Denial of Claims”

A new report from the Office of Inspector General at the Department of Health and Human Services says it has found “widespread and persistent problems related to denials of care and payment” in the Medicare Advantage program.   The report recommends increased oversight of the plans and more information for beneficiaries about the problem and denials.  The report says that Medicare Advantage plans, also known as Medicare managed care, deny claims in order to maximize profits.  Many Medicare beneficiaries are not really aware that the denials are inappropriate or that they could appeal.  In fact, when they do appeal, 75% of those appeals are successful to gain coverage that is denied.

About one third of Medicare beneficiaries have joined the Medicare Advantage plans with many experts predicting that half of all beneficiaries will be in Medicare Advantage in the coming year.  These plans typically provide greater benefits than regular Medicare offering those extras like gym membership or partial coverage for dental or eyeglasses which are meant to entice beneficiaries to join their plans.  However, this report from the Inspector General says they attempt to maximize their profits by controlling costs and denying claims.   They are supposed to provide all the benefits that the regular Medicare plan provides.

Beneficiaries can switch plans or go back to traditional Medicare.  The open enrollment period begins today, October 15

Here is a summary of the report findings from the Inspector General


A central concern about the capitated payment model used in Medicare Advantage is the potential incentive for MAOs to inappropriately deny access to services and payment in an attempt to increase their profits. An MAO that inappropriately denies authorization of services for beneficiaries, or payments to health care providers, may contribute to physical or financial harm and also misuses Medicare Program dollars that CMS paid for beneficiary healthcare. Because Medicare Advantage covers so many beneficiaries (more than 20 million in 2018), even low rates of inappropriately denied services or payment can create significant problems for many Medicare beneficiaries and their providers.


We collected data on denials, appeals, and appeal outcomes for 2014-16 at each level of the Medicare Advantage appeals process. We calculated the volume and rate of appeals and overturned denials at each level. To examine CMS oversight, we analyzed CMS’s 2015 audit results and the resulting enforcement actions, including Star Ratings data from 2016 to 2018.


When beneficiaries and providers appealed preauthorization and payment denials, Medicare Advantage Organizations (MAOs) overturned 75 percent of their own denials during 2014-16, overturning approximately 216,000 denials each year. During the same period, independent reviewers at higher levels of the appeals process overturned additional denials in favor of beneficiaries and providers. The high number of overturned denials raises concerns that some Medicare Advantage beneficiaries and providers were initially denied services and payments that should have been provided. This is especially concerning because beneficiaries and providers rarely used the appeals process, which is designed to ensure access to care and payment. During 2014-16, beneficiaries and providers appealed only 1 percent of denials to the first level of appeal.

Centers for Medicare & Medicaid Services (CMS) audits highlight widespread and persistent MAO performance problems related to denials of care and payment. For example, in 2015, CMS cited 56 percent of audited contracts for making inappropriate denials. CMS also cited 45 percent of contracts for sending denial letters with incomplete or incorrect information, which may inhibit beneficiaries’ and providers’ ability to file a successful appeal. In response to these audit findings, CMS took enforcement actions against MAOs, including issuing penalties and imposing sanctions. Because CMS continues to see the same types of violations in its audits of different MAOs every year, however, more action is needed to address these critical issues.


We recommend that CMS (1) enhance its oversight of MAO contracts including those with extremely high overturn rates and/or low appeal rates and take corrective action as appropriate; (2) address persistent problems related to inappropriate denials and insufficient denial letters in Medicare Advantage; and (3) provide beneficiaries with clear, easily accessible information about serious violations by MAOs. CMS concurred with all three recommendations.

Copies can also be obtained by contacting the Office of Public Affairs at

National Council on Aging (NCOA) Raises Alarm about Trump Plan to Penalize Immigrants Using Public Programs

On September 22, the Trump Administration issued a proposed rule change regarding immigration policy that would expand the number of public programs taken into consideration in determining whether a immigrant is a “public charge” who would be dependent on public funding.    The public charge determination would negatively impact whether an immigrant should be admitted to the United States or given permanent residence with green cards.

The National Council on Aging (NCOA)  and other aging advocates have raised concerns not only about the impact on older immigrants using public benefits but also about the 1 in 4 direct care workers who are immigrants in health and service professions taking care of seniors and the disabled.  Advocates worry that immigrants will forego needed benefits in order to preserve chances for a green card.

NCOA said, “If the rule is finalized in its proposed form, this would mark a significant and harmful departure from the current policy. For over a hundred years, the government has recognized that work supports like health care and nutrition help families thrive and remain productive. And decades ago, the government clarified that immigrant families can seek health and nutrition benetits without fearing that doing so will harm their immigration case. If this rule is finalized, we can no longer offer that assurance. Benefits that could be considered in a “public charge” determination targets key programs that help participants meet their basic needs, such as: •

Non-emergency Medicaid (with limited exceptions for certain disability services related to education).

• Supplemental Nutrition Assistance Program (SNAP).

• Low Income Subsidy for prescription drug costs under Medicare Part D;

Section 8 Housing vouchers