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  • Writer's pictureDr. Lloyd

More Medicare Advantage Chicanery by Lloyd I Sederer MD

Buyer beware is the watchword if you are on Medicare. Knowingly fraudulent billing by Medicare Advantage plans (which cover 29 million Americans) amounts to $80-160 billion/year, which Medicare funds with your federal tax dollars and mine.

Becker’s Hospital Review underscores the massive, unfettered, and knowingly fraudent billing by Medicare Advantage Plans, the for-profit, managed care plans that cover 29 million Americans. There is something very wrong when your taxes and mine pay over $80 billion/year of false claims by Medicare Advantage Plans.

Annually, seniors on Medicare (like me) are offered a period of “Open-Enrollment”.  We are free to change our Medicare plan from traditional Medicare (TA) to one of a gaggle of for-profit Medicare Advantage (MA) - managed care plans - or to move from one of these plans to another. It’s more like “open season” for these plans to poach and enroll existing federal Medicare recipients or those of one of their competitors.

Recently, in my (snail) mail was an offer for me to join one of the MA plans. Its promotional text said, “Save More Money”, “Get Better Care”, “Travel With Confidence”. But I knew better, though not at that time specifically about the company offering me such bounty. I tossed the flyer.

Medicare Advantage Plans, a great many (see below), want me and countless others as subscribers not because of those reasons above. It’s because it provides an opportunity that some (with a large market share) employ for to fraudulently overcharge the federal government and line their pockets, and those of their investors. These are plans who have figured out how to “game” their billing. The secret is what is called “risk adjustment” (1,2,3). They pad bills with codes for fictional diagnoses, thereby increasing their ”adjusted risk” to get paid more money than they are due from the federal government. 

They become, as well, prey themselves because their chicanery is a good target for federal “whistleblowers”. (1)

Alicia Wilbur, the (former) manager of “risk-adjustment operations” for Martin Point Health Care (a Maine based MA Plan), walked away with $3.9 million, to her personally, by blowing the federal whistle on them. Martin Point Health Care agreed to pay $22.5 million to the US Department of Justice (DOJ). Yet, they kept on going their unfettered way, shy of not enough money (in this case, $22.5 million), I infer, for them to fix their fraudulent ways.  

Ah, it was good that I did not trust the Martin Point’s MA Plan when they came after me.

Martin’s Point knowingly filed fraudulent patient diagnostic codes to fleece Medicare, which is funded by our taxes. In other words, they were fleecing you and me (1).

The DOJ case against Martin’s Point, was based on 3 years of patient data. The data reported that, knowingly, 60% of the illnesses this Plan filed were for unsupported diagnoses, meant to increase their revenues, aka profits. That’s way more than a rounding or point in time error.(1) 


Martin’s Point is among a group of MA Plans with market dominance that (collectively) overcharge an estimated $88 billion, minimally and annually (Reference: Our Payments, Their Profits, Physicians For A National Health Program {PNHP}, When “dual eligible” (Medicare and Medicaid) recipients are included, the additional overcharges for dental, vision, and hearing services nearly double that $88 billion, entering the three-digit zone. A $billion here, a $billion there, that’s real money. What do you call, $100 billion here, 200 billion there? A “feeding frenzy”?(1,2,3,4)

Rounding up the miscreant Plans for DOJ to litigate is trying to catch horses after they are out of the barn. Too many are not identified, no less caught and prosecuted, for defying legal billing rules or tampering with the “risk adjustment” of MA Plans. 

Martin’s Point is not alone. 

For example, the famed Kaiser Permanente called their doctors in to urge them to add more diagnoses to their bills. Those that did could earn bottles of champagne or pay bonuses. The DOJ estimated that Kaiser earned $1 billion from additional diagnostic codes from 2009 to 2018 (1).

Anthem, now Elevance Health, paid their doctors more when they reported their patients to be sicker (1).

United Health Care, the giant of US private healthcare insurers, told their employees to “mine old records” that could contain more diagnoses; when their yield was not great enough (as determined by United executives), they were sent back for more (1).

Eight of the ten of the largest MA Plans, two thirds of their market, according to a federal audit, have submitted inflated bills. Four of them (United, Humana, Elevance, and Kaiser) have faced federal audits alleging billing fraud. But these plans have proven themselves to be incorrigible: they do not correct their illegal billing practices after their fraud is discovered, or even fined (1,5,6). Some cases of Medicare fraud date back over a decade.

These highly lucrative, private sector MA plans will, within a year, insure more than half of all Medicare recipients. The federal government spends more to pay MA plans, with their 29 million subscribers, than on two branches of the US Armed Forces. But how can we Medicare recipients know who is up to this thievery when government regulatory agencies, Congress too, are avoidant of “getting tough”, namely creating effective deterrents to their continuing on their crooked ways. So, the Plans continue to bleed Medicare of money generated by federal taxes.


Prisons, government agencies, and failing corporations (other organization too) can be judicially put under a “Special Master”, a watchdog, skilled in guarding the barn door. In other words, in guarding your money and mine. Because, so far, whistleblowers and occasional DOJ prosecutions and fines are not doing the job.  

We taxpayers not only warrant justice. We also deserve better protection of our money.



  1. Reed Abelson and Margot Sanger-Katz, “‘The Cash Monster Was Insatiable’: How Insurers Exploited Medicare for Billions,” The New York Times, October 8, 2022,

  2. Physicians For A National Health Program {PNHP},

  3. Richard Gilfillan, Donald M. Berwick, Health Affairs Blog Highlight How the Medicare “Money Machine” Draws Medicare Advantage Plans and Investors into Direct Contracting Demonstrations,

  4. Christopher Moriates, MD; Neel T. Shah, MD, MPP; Vineet M. Arora, MD, MAPP, First do no financial harm, JAMA, July 8, 2013

  5. Richard Gilfillan and Donald M. Berwick, “Born On Third Base: Medicare Advantage Thrives On Subsidies, Not Better Care,” Health Affairs, March 27, 2023, https://www. subsidies-not-better-care 

  6., Why People Are Leaving Medicare Advantage Plans,

  7. Lloyd Sederer, I Hate Being a Doctor: Why Do Doctors Hate Their Jobs? June 16, 2023,

  8. Lloyd Sederer, Who’s Minding the Store The depletion of the US physician workforce,


My new book is getting some early reader attention and endorsements, one of which is attached.

“Crosshairs” is now an Amazon Bestseller!


An endorsement from a great colleague.

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Paul Nelson
Paul Nelson
Dec 18, 2023

The ongoing reference to Medicare trust funds continues the Emperor's Clothes fable by projecting when they will become insufficient given concurrent levels of health spending. President Lyndon Johnson used the Trust Funds to pay for the Vietnam War. He obtained the funds by writing an IOU from the Presidency to Congressional Treasury. The Treasury continues the annual charade to assuage everyone for now that all is well with the financial affairs of Social Security. Also, Congress and its personnel do not participate in Medicare. They have their own retirement plan and their own health insurance plan. They negotiate the pricing of their pharmaceutical plan (used by the 340B distribution process). Meanwhile, our nation's maternal mortality rate continues to wor…

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