Representative David Schweikert (R-AZ-01), who has sounded the alarm for years about Medicare running out of money, recently co-chaired a hearing of the Joint Oversight and Health Subcommittees of the U.S. House Committee on Ways & Means, to discuss problems with Medicare Advantage (MA). Schweikert chairs the Oversight Committee, and ran the hearing with Representative Vern Buchanan (R-FL-13), who chairs the Health Subcommittee. Most of the hearing, which lasted several hours, consisted of testimony from doctors and healthcare experts.
Schweikert introduced "To Amend Title XVIII to Reform the Medicare Advantage Program" this year, which would reform the MA program, providing an alternative to traditional Medicare by allowing private insurers to offer plans.
MA has become a popular alternative to traditional fee-for-service (FFS) Medicare. However, Schweikert said misaligned incentives have created a system that now costs 20 percent more per enrollee, without delivering the better service recipients deserve. “In seven years, the Medicare Part A trust fund is empty,” he warned.
Unfortunately, people are being paid to spread disinformation. “There are some bad actors,” Schweikert said. “If any of you are the lobbyist for whoever is buying the MAGA influencers to basically attack anyone who's trying to understand the economics within Medicare Advantage, please understand that I’m asking the lawyers to start investigating. Is this registered lobbying? And we're going to find out who's paying for it.”
He recommended a seven-part series published in The Wall Street Journal which found that insurers pocketed $50 billion from Medicare for diseases that doctors never treated. Schweikert said one of the problems is “the incentives are misaligned,” meaning they’re focusing on treatment rather than prevention. He said “31% of Medicare is diabetes.” Schweikert often gives speeches on the House floor explaining how providing incentives to people to be healthier can solve a lot of the debt caused by treating the rise in diabetes and obesity. He warned, “Medicare is going from $1 trillion now to $2 trillion in seven years.”
Representative Lloyd Doggett (D-TX-37), who serves as the ranking Democrat member on the Health subcommittee, stated, “The nonpartisan, independent Medicare Payment Advisory Commission, or MEDPAC, estimates that taxpayers will spend 20 percent more this year for people in Medicare Advantage than if they had been enrolled in traditional Medicare … $84 billion this year alone.” He said every enrollee “is paying an average of $198 more in Part B premiums this year because of overpayments to MA insurers.”
“For years, I've heard from hospitals, home healthcare providers and other professionals who are experiencing increasing administrative burdens, delays in reimbursement and smaller payments that are falling below what traditional Medicare would have paid,” Doggett said.
He sponsored the “Guarantee Utilization of All Reimbursements for Delivery of (GUARD) Veterans’ Health Care Act,” which would end a loophole that allows double billing for services provided to veterans. He also sponsored the “Prompt and Fair Pay Act,” which would “ensure MA plans at least pay what traditional Medicare pays for covered items and services.”
Most of the Democrats participating in the hearing focused on criticizing the “Big Ugly Bill,” President Donald Trump’s Big Beautiful Bill that cut waste and fraud out of Medicare. They asserted that it will cut off coverage for many, but didn’t mention that those people weren’t entitled to the coverage. They also objected to using AI for more efficiency in healthcare.
Dawn Maroney, CEO of Alignment Health Plan and President of Alignment Health, said her company “uses artificial intelligence to identify the sickest members who drive 80 percent of the cost — not to prevent it, not to deny it, but to be proactive in that integration of proactive healthcare.” She explained how efficient Alignment is, relaying how a man had low blood sugar, and they solved the problem by sending him a $30 pizza instead of a $20,000 hospitalization.
Dr. Brian Miller, Associate Professor of Medicine at Johns Hopkins University and a practicing hospital medicine physician, noted that there were 5.4 million retirees in group MA plans when the Stark Law was passed over 20 years ago. The Stark Law prohibits physicians from referring patients to entities with which they have a financial relationship for certain designated health services covered by Medicare or Medicaid, unless an exception applies.
“We should support a Stark Law waiver in the setting of managed care to support private practice and physician owned enterprise to compete against big hospital monopolies,” Miller suggested. “I would point out that in 2023, 2.8 million people entered the Medicare program, and slightly less than half of those entered Medicare Advantage, and slightly more than half entered fee for service Medicare.”
Dr. David Basel, Vice President of Clinical Quality and Population Health Officer for
Avera Health, who practices internal medicine and pediatrics, testified, “On the healthcare delivery side, we are seeing issues such as payment denials, authorization, delays, and non-payment by MA plans that are hitting our rural facilities and their patients particularly hard. Even though we overturned more than 70 percent of these denials, the administrative burden continues to climb. We are seeing MA plans starting to refuse payment for longer patient stays, stating they exceed expected length, even when that longer length of stay is directly related to post acute authorization.”
He added later, “if we're overturning more than 70 percent of the denials, then there's a lot of unnecessary administrative overhead that goes into that. There's got to be a better way of doing that.”
Dr. Sachin Jain, president and CEO of Senior Care Action Network (SCAN) Health Plans, and a board certified internal medicine physician, told the committee members, “Traditional Medicare in its original form has important gaps. It doesn't offer dental, vision, and hearing benefits. It focuses little on prevention and offers scant coordination of services.”
He said, “Families are on the hook for significant cost sharing, or they can elect up to $1,000 in expenses for Part B, Part D and supplemental premiums, with seniors carrying an average annual income of about $50,000 for a household, and the traditional program is out of range for lower and middle income older adults. Medicare Advantage helps fill those gaps.”
He praised Medicare Advantage, “A man with hypertension has access to a health coach, a dietitian, and remote blood pressure monitoring, because under MA, managing chronic disease makes more sense than managing its complications. Congress, in its wisdom, gave plans the flexibility to innovate, service, and benefit design.”
Matthew Fiedler, a health economist and senior fellow at the Brookings Institution, focused his testimony on the costs. “Covering a Medicare beneficiary under Medicare Advantage costs an estimated 20 percent more than covering the same person under traditional Medicare. That differential will generate about $84 billion in additional payments to MA plans this year. This additional cost is borne mostly by taxpayers, but around 15 percent or roughly $13 billion is financed through higher Medicare Part B premiums. Notably, those higher premiums are paid by all Part B beneficiaries, not just those who opt to enroll in MA.”
He said the “current system overstates the needs of MA enrollees because plans report more health conditions for their enrollees than would be reported for the same enrollees if they were enrolled in traditional Medicare, where the same incentives — incentives to record every possible diagnosis — does not exist.”
Fieldler said directing more money at Medicare Advantage doesn’t solve the problem. “Research shows that paying an MA plan an additional dollar delivers much less than $1 of value to enrollees. When policy makers make the MA payment system more generous, insurers respond by raising the prices they charge to deliver the basic Medicare benefits.”
Jain emphasized that treatment needs to be focused on prevention. “The reality is that we have a medical system right now that treats people when they become sick, but does very little to actually prevent them from becoming sick in the first place. 65 [years old], however, is too late.”
A prevalent theme that came up during the hearing was requiring excessive prior authorizations. Miller stated, “It should be real time — you submit your data automatically; ports, labs, notes, imaging studies. You should be able to access what the medical criteria are for prescription outpatient prescription drugs. It's very fixable.”
Representative Terri Sewell (D-AL-07) responded, “Prior authorization is the number one complaint I hear about.” Maroney told her that the denial rate at her company is fairly low. “There are a lot of referrals that people go through that should be auto approved.”
Representative Mike Thompson (D-CA-04) pointed out a study that found “authorization delays contribute to at least three and a quarter billion dollars in avoidable costs every year, and that's just in California.”
Sewell asked Basel about AI. He said, “AI could be a good thing, because if it helps increase the speed to where you can get a prior authorization approved, because it automatically, you know, kind of gold cards or something like that.”
For rural areas, the panel testifying mainly said there is a need to assist with the costs of medical transportation, and focusing on preventative care. Basel stressed that health club benefits should be an option. Another problem he brought up is a lack of capacity in rural hospitals; patients sometimes have to wait until another patient is moved out.
Miller pointed out that a lot of the process can be streamlined by allowing people to do much of it on their smartphones.
Representative Rudy Yakym (R-IN-02) observed how in 2007, only 19 percent of Medicare beneficiaries chose MA plans. Now, 54 percent do. He said they “tend to have better outcomes when compared to their peers on traditional Medicare,” with “70 percent fewer hospital readmissions and 25 percent fewer inpatient stays.”
Representative Judy Chu (D-CA-28) asked Fiedler why the system hadn’t detected the fraud, which Republicans addressed in the recent spending bill. He responded, “Medicaid work requirements are not a policy targeted at fraud.”
Greg Murphy, M.D. (R-NC-3), a surgeon and urologist, said that while he’s a fan of MA plans, United Healthcare has “bastardized the system and they have ruined Medicare Advantage.” He cited the articles from The Journal that Schweikert mentioned earlier, how insurance companies pocketed a billion dollars in extra payments.
“It shows how especially United Health Group, I'm calling them out, and I'll continue to call them out without objections, or some people that are probably going to end up going to jail, because of the way they've ruled the system,” Murphy said. “How United’s army of doctors — they’re the largest employer of physicians in the country — how they mobilize them, how they militarize them.”
Miller suggested, “We should look to empower private practice as a viable alternative to large tax-exempt hospital monopolies and have a Stark waiver in managed care to make private practice great again.” A Stark waiver is a temporary suspension or relaxation of specific requirements under the Stark Law, a federal statute that prohibits physicians from referring Medicare or Medicaid patients for designated health services to entities with which they or their immediate family members have a financial relationship, unless an exception applies.
Murphy responded, “The insurance lobby is the strongest lobby in this town. It has strangled this place. It's time for Congress to take back what was originally intended for health care and not let the insurance industry strangle this country.”
Representative Aaron Bean (R-FL-04) observed, “We partnered with managed care to get our [healthcare system] under control, and I think Florida has one of the largest state surpluses in the nation is because we finally worked to make that happen.”
Bean said he sponsored the “Apples to Apples Comparison Act of 2025” earlier this year, which would provide transparency by comparing the costs of MA to FFS Medicare programs. He asked if Maroney if MA is “delivering a cost efficient solution for seniors and taxpayers.”
She responded, “Absolutely. When you look at the average consumer or beneficiary that enrolls to an MA plan, they're older than 71 years old. The average premium is about $17 for those individuals. However, for our program, most of those individuals have a zero premium plan.”
When asked about the fraud, Miller commented, “There are a couple bad actors that probably deserve a visit with the Department of Justice.”
Representative Kevin Hern (R-OK-01) criticized the Biden administration. “Unfortunately, due to the past administration's heavy-handed actions, it is becoming harder for MA plans to offer a wide array of supplemental benefits for our seniors.” He asked Jain how this has affected seniors.
Jain told him, “The first has really been risk adjustment and the implementation of the V28 Risk Model, which effectively has been a revenue haircut to the industry. The industry gets less revenue. We're able to offer less benefits.” The V28 Risk Model, officially known as Version 28 of the CMS-HCC (Centers for Medicare & Medicaid Services Hierarchical Condition Category) model, is a risk adjustment framework used to predict healthcare costs for MA beneficiaries.
He went on, “The second area where CMS made changes was on the star ratings, and the methodologies used to actually calculate the cut points, four star ratings. And what we've seen is, there's been a decline in the number, plus star rated plans across the industry. That means that plans are achieving fewer bonus dollars, and as a result, are getting less revenue. And those bonus dollars are actually used to fund supplemental benefits.”
Representative Nathaniel Moran (R-TX-01) asked Miller, “How might administrative burdens associated with prior authorization impact the work of physicians and staff?”
Miller responded, “We should use AI to make the process more efficient. If I can automate prior approval for a drug, a surgery, an imaging study, that is a win and we need to make that the default.”
Moran asked Maroney how to increase transparency. She told him the solution is to release data publicly, including prior authorizations.
Representative Beth Van Duyne (R-TX-24) co-sponsored the “Improving Seniors’ Timely Access to Care Act,” which aims to streamline the prior authorization process under MA. She said there are “heartbreaking stories of patients who have been lying on the table waiting for prior authorization.”
Van Duyne She asked Maroney when these lapses happen. Maroney said they don’t occur in hospitals, but during “continuity of care or transition of care or post care.”
Representative Brian Fitzpatrick (R-PA-01) said 54 percent of those enrolled in Medicare select MA. In his state, they pay 37 percent less for MA than they do traditional Medicare; more seniors are choosing to enroll in MA plans, “with an average of over $3,000 savings on out-of-pocket costs and premiums.” Additionally, there are “70 percent fewer hospital remissions for MA beneficiaries relative to the traditional population and lower rates of unnecessary medication usage.”
Representative Max Mr. Miller (R-OH-07) said MA results include “one-third fewer emergency room visits and a 29 percent reduction in avoidable hospitalizations.” He asked Dr. Miller how to enhance quality and efficiency of care. He responded, “Make it easy for clinicians and health systems to plan so don't have all these unnecessary steps. Fax machines. I mean, I haven't seen a fax machine in someone's home for 20-plus years.”
Representative Thomas Suozzi (R-NY-03) asked the panel of experts if “Medicare Advantage is good or does it need to be fixed?” Most of the panel said it needed fixing, with some stating it needs more fixing than others. Suozzi asked them if it costs more than it should. Most of the panel responded saying it does.
Souzzi asked them whether upcoding and downcoding is a problem. Upcoding occurs when a healthcare provider submits a billing code for a more expensive procedure, service, or diagnosis than what was actually performed or diagnosed. Downcoding occurs when a healthcare provider submits a billing code for a less expensive procedure, service, or diagnosis than what was actually provided, resulting in lower reimbursement. Most of the panel said there are some problems but it’s a small percentage. However, one panelist said it was widespread.
Moore asked Miller how to fix the upcoding problem. Miller said software should automatically select the code and then have the physician make a decision as to whether it's appropriate.
Representative Linda Sánchez (D-CA-38) asked Jain if Trump’s tariffs are increasing premiums. Jain said he hadn’t seen any evidence of that yet. She asked him if Republicans failing to renew the enhanced premium tax credits in the Affordable Care Act, known as Obamacare, will impact marketplace premiums. Jain said he hadn’t seen any evidence of that yet either.
Schweikert wound down the hearing discussing AI. “We have the technology today that follows you around, that the AI transcribes your notes,” he said. “Here's my doctor's notes. Here's my health care contract that would be private or Advantage plan; the AI can say they match. And it's basically automated or pre-authorization.”
Miller said, “It’s possible.” However, “If you're an incumbent large health system, you don't have an incentive to improve operations when, if you're a hospital executive, and you can lobby to increase Medicare fee for service rates. You can merge with a larger health system. You can do all these other things before coming to the table to improve clinical integrity.”