ELV - Medicare Advantage players slammed by Senators for putting profits over care
2023-03-24 11:01:48 ET
U.S. Senators Elizabeth Warren (D-Mass.) and Jeff Merkley (D-Ore.) have sent "strongly worded" letters to seven leading Medicare Advantage (MA) insurers this week for putting "enormous profits over care for seniors" while protesting over proposed rate cuts to the program.
"We write today regarding the outsize profits your company has earned in the Medicare Advantage program, the extraordinary salaries paid to you and other executives, and the billions your company has spent on dividends and buybacks," the Senators wrote.
The letters are addressed to the Chief Executives of Humana ( HUM ), Centene ( CNC ), UnitedHealthcare ( NYSE: UNH ), CVS Health ( CVS ), Molina ( MOH ), Elevance Health ( ELV ), and Cigna ( CI ), which account for 70% of the MA market.
In February, the industry opposed the MA payment rates the Centers for Medicare & Medicaid Services (( CMS)) proposed for 2024.
Noting that CMS' Proposed MA Payment Rule more accurately accounts for the cost of care, Warren and Merkley argued: "It is outrageous that industry groups, on your behalf, are putting your plan's enormous profits over care for seniors."
The Senators points out that the seven companies raked in $1.25T in revenue in 2022 generating $69.3B in profits with a ~287% rise. "But rather than investing in benefits for patients, these seven health insurers instead spent $26.2 billion on stock buybacks, they added.
Due to what they saw as "outsized profits and the long history of corporate profiteering in the MA program," the Senators demand responses from the health insurers by Mar. 29.
Read: Despite MA headwinds, JPMorgan defended the managed care sector in February.
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Medicare Advantage players slammed by Senators for putting profits over care