Sign up for PNHP's E-Alerts. That's wasted money that should have been spent on improving patient care, shoring up Medicare's trust fund or reducing the federal deficit, the researchers say.

The findings appear in an article published in the International Journal of Health Services by Drs. Ida Hellander, Steffie Woolhandler and David Himmelstein titled "Medicare overpayments to private plans, Hellander is policy director at Physicians for a National Health Program PNHPa nonprofit research and advocacy group.

Woolhandler and Himmelstein are professors at the City University of New York School of Public Health, visiting professors at Harvard Medical School and co-founders of PNHP.

Medicare has contracted with private insurance plans — previously referred to as Medicare HMOs and now called Medicare Advantage plans — since Such plans, most of them for-profit, currently cover about 27 percent of Medicare enrollees and have been growing at a fast clip.

UnitedHealth and Humana are among the largest players in this market, and together operate about one-third of such plans.

The authors find that private insurers have four how do insurance companies make money on medicare advantage that make them more costly than how do insurance companies make money on medicare advantage traditional Medicare program. Private plans cherry-pick healthier beneficiaries who cost less to care for, guaranteeing large profits.

Although private plans must accept all seniors who choose to enroll, they cherry-pick by selectively recruiting ticker meaning in stock market healthiest seniors through advertising, office location, etc. They also induce sicker ones to disenroll by making expensive care inconvenient. They recruit otherwise healthy seniors with very mild and inexpensive cases of sometimes serious conditions — automatically triggering higher premiums for these beneficiaries from the risk-adjustment scheme implemented inbut escaping payments for expensive care.

For instance, many seniors have very mild cases of arthritis, heart failure and bronchitis that require little or no treatment. They enroll patients who get stockbrokers who fail of their care free at the Veteran's Administration.

Free Information Guide | AARP® Medicare Supplement

They heavily lobby Congress to raise their reimbursement. The insurance industry successfully induced Congress and the Bush administration to add bonus payments to Medicare Advantage premiums beginning in Since the study was completed, the industry has again successfully lobbied the administration to raise payments to Medicare Advantage plans, reversing a planned cut of 2. Stock prices of private insurers soared over the announcement.

Ida Hellander, lead author of the study.

Home is where the money is for Medicare Advantage plans | Center for Public Integrity

In fact the opposite is the case. The private plans only add waste, and the aggregate waste is staggering — enough to be a significant drag on the economy.

How Medicare Advantage Plans work | ydigatocop.web.fc2.com

International Journal of Health Services, May 10, online firstVol. Physicians for a National Health Program http: Donate to PNHP ABOUT PNHP CONTACT US. Sign up for PNHP's E-Alerts -1 this. Alabama Alaska American Samoa Arizona Arkansas California Colorado Connecticut Delaware D. Quote of the Day. Schedule a Grand Rounds.

State Chapters Start a Chapter. Data Update Newsletter Renew your Membership Slideshows. SNaHP Blog Additional Resources. E-mail Print page Share. Mark Almberg,mark pnhp.