With the open enrollment period starting in three days, this a good time to analyze the entire concept of Medicare Part C also known as Medicare Advantage. Their are many gaps in our current Medicare system that makes the Medicare recipient responsible for deductibles, co-insurance and co-payments that Medicare does not cover. Insurance companies offer two types of plans to help cover those costs. There are Medicare Supplement plans that offer standardized options to help fill those gaps and then there are the Medicare Part C aka Medicare Advantage plans which are contracts the health Insurance companies sign with Medicare where Medicare pays the health insurance company to administer the recipient’s Medicare benefits.
Anyone paying attention to political campaigns knows that the largest expenditure for a campaign is in advertising, especially TV advertising. Remember that political candidates receive a discounted rate over non-campaign advertising, so TV advertising for any consumer product is going to be very expensive. So we all need to be asking the question, where does over 95% of the health insurance industry’s advertising dollars go when pitching Medicare insurance policies? The answer is certainly not for Medicare Supplemental plans. United Health Care which promotes both types of plans, to my knowledge is the only major insurance company that promotes Medicare Supplement plans.
The costs that the health insurance industry pays for promoting Medicare Advantage plans is astronomical. Joe Namath and Jimmy J.J. Walker do not work for peanuts. In addition to TV ads, they spend a considerable sum on direct mail and telephone solicitations. Like any other corporation, the number one goal of health insurance companies is to maximize profits. There is only one conclusion that can be reached. In order to not only cover the costs of the advertising and marketing budget and then generating the company’s very healthy profit, these health insurance companies are being grossly over payed by the taxpayers for the services they provide. It is time for the Congress and the administration to reign in this rip off of the American taxpayer by cutting back on the amount of our tax dollars these contacts provide.