web analytics

Biden Cuts Payments to Medicare Advantage Plans

Pain coming for seniors if the White House axes private medical care services.

by | Apr 20, 2024 | Articles, Healthcare, Opinion

President Joe Biden followed through on his administration’s proposal to reduce next year’s base payments to Medicare Advantage (MA) plans by an average of 0.16%. This marks the second consecutive year of appeasing progressives. For the last couple of years, health care proposals arising from the ashes of Bidenomics have led to multiple questions – chief among them: Is the administration trying to gut private medical care?

Medicare Advantage Gets a Haircut

Also known as Medicare Part C, Medicare Advantage is a type of hospital and medical insurance offered by private firms rather than the federal government. The Medicare-approved entities are required to follow the rules outlined by the US government. AARP, an advocacy group for senior citizens, best described the program for 33 million users as “choosing between ordering the prix fixe meal (Medicare Advantage) at a restaurant, where the courses are already selected for you, or going to the buffet (original Medicare), where you must decide for yourself what you want.”

Estimates suggest that Medicare Advantage’s medical costs will surge by an average of 3.7%, or $16 billion, in 2025. Insurers note that they are already experiencing rising costs amid higher demand from patients playing catch-up with their health care needs that were abandoned during the coronavirus pandemic. Following last year’s payment decrease, many plans bolstered patient co-pays and premiums while trimming benefits such as dental and eye care. Ultimately, it will be more of the same next year.

Will this lead to political upheaval for the incumbent? Critics say it’s ridiculous for Biden to accuse Republicans of wanting to gut Social Security and Medicare while simultaneously cutting benefits himself. Additionally, millions of people utilize Medicare Advantage and find themselves paying more for less.

Despite being a serious voting bloc, however, seniors might not lead a political revolt at the polls come November, according to market watchers. “President Biden’s team is gambling that MA beneficiaries won’t realize before the election the benefits Biden’s team is causing them to lose come January 2025,” said Raymond James analyst Chris Meekins.

But while the punditry class observes the politics of the situation, the decision also could be another example of the administration’s attempt to remove private industry from the health care sector entirely.

Private Industry Exodus?

Since the days of Michael Moore being the de facto head of the leftist movement, Democratic lawmakers and progressive activists have routinely fought against private medical services across the US health system. They have championed a more centrally controlled apparatus that emulates those found in Canada and Europe. A tidal wave of policies and announcements from 1600 Pennsylvania Ave. appears to support these years-long efforts.

In March, the White House launched a strike force to crack down on what US officials deem to be unfair and illegal pricing. The initiative, led by the Department of Justice and the Federal Trade Commission, aims to target a wide array of industries. One of these sectors that all the president’s men and women will concentrate on is health care, including prescription drugs.

As Liberty Nation has reported, Biden is trying to impose stealth price controls for pharmaceuticals, reminiscent of Nixon’s similar crusade.

A provision in the Inflation Reduction Act extends the Department of Health and Human Services the power to negotiate prices on specific prescription drugs covered under Medicare Parts B and D. The federal government will arbitrarily determine the maximum fair prices for the 60 products. This may sound benevolent, but if these companies do not cave to government demands, they will either be slapped with an excise tax as high as 95% or be forced into exile. Although the White House estimates that this will save taxpayers around $160 billion over the next decade, the president failed to mention the various unintended consequences of these backdoor price controls, including a lack of new products and a slowdown in R&D investment.

This past summer, the president and several other Democrats proposed clamping down on short-term health insurance plans that offer medical care coverage for up to one year. Biden, who has referred to them as “junk” health plans, claims these products undermine the Affordable Care Act, colloquially known as Obamacare. And his scheme is in addition to his quest to rein in so-called junk fees in the medical system.


Is health care a right? Should the government manage it? Are patients being price gouged? Is it too expensive to repair a broken bone? The debates will vary, but many consumers spend an arm and a leg when seeking medical care. About a fifth of adults with health care debt have declared bankruptcy amid rocketing inflationary pressures across the industry. This could be due to too much state intervention and immense bureaucracy. For now, Americans take comfort in the fact that Brits wait months for appointments and Canadians are given the option of participating in Medical Assistance in Dying (MAID).

Read More From Andrew Moran

Latest Posts

Can Trump Win the Libertarian Vote in 2024?

Former President Donald Trump was in Washington, DC, last night, May 25, making his case to the attendees at the...