Friday morning will bring another monthly jobs report, the last reading on the economy before Tuesday’s election. Until then, here’s what we’re watching while trying to tune out incessant election ads.
‘Fraudsters and Scam Artists’ Plague Medicare Advantage: Report
You’ve probably seen TV ads featuring D-list celebrities pitching Medicare Advantage plans by claiming that seniors may be missing out on valuable benefits. But Medicare beneficiaries are also being inundated with other aggressive — and often deceptive — Medicare Advantage marketing tactics, according to a report released Thursday by Senate Finance Committee Democrats.
Among the examples in the report:
• Seniors shopping at their local grocery store are approached by insurance agents and asked to switch their Medicare coverage or MA plan.
• Seniors who were told by insurance agents that their doctors are covered by a new plan find out later that their doctor is not in network and they must pay out-of-pocket for a visit.
• Seniors receive marketing mailers designed to misleadingly look like official communication from a federal agency such as the Internal Revenue Service, Social Security Administration or Medicare.
• Seniors get flooded with 20 calls a day from an insurance agent trying to convince them to switch their Medicare coverage.
The report, based on information from 14 states, found that such marketing practices are “widespread, not isolated events.” It said that five states had shared examples of insurance brokers targeting beneficiaries with cognitive impairment and six states provided examples of people being signed up for Medicare Advantage plans without knowing it. It also noted that the number of beneficiary complaints about Medicare Advantage marketing received by the Centers for Medicare & Medicaid Services (CMS) more than doubled from 2020 to 2021.
“It is unacceptable for this magnitude of fraudsters and scam artists to be running amok in Medicare and I will be working closely with CMS to ensure this dramatic increase in marketing complaints is addressed,” Sen. Ron Wyden (D-OR), chair of the Finance Committee, said in a statement. “Medicare Advantage offers valuable plan options and extra benefits to many seniors but it is critical to stop any tactics or actors that harm seniors or undermine their confidence in the program.”
Why it matters: Under Medicare Advantage, sometimes called Medicare Part C, the government pays private insurers to cover health benefits for seniors. Such plans have grown in popularity and will soon cover more than half of Medicare enrollees. They’re also extremely lucrative for insurers — but as The New York Times reported recently, most large insurers in the program have been accused of fraud.
“Because it’s such a profitable line of business, they have an incentive to do more marketing,” Tricia Neuman, a senior vice president at the Kaiser Family Foundation, told The New York Times. “And they have more money to do marketing, which increases revenue.”
What can be done: This year’s open enrollment for 2023 Medicare plans is ongoing and will last until December 7. Seniors are advised to be on the lookout for potential scams and exercise caution if calling a number advertised on television or clicking on a sign-up link. The report says seniors can also call 1-800-MEDICARE for help if they think they’ve been enrolled in a plan that’s not right for them.
Beyond that, the Senate report includes a number of recommendations that it says would cut down on future use of such troublesome marketing tactics, including strengthening requirements that were loosened under the Trump administration, monitoring disenrollment patterns and then holding bad actors accountable, implementing stronger rules for Medicare marketing, and promoting legitimate sources of information.
“Medicare has told plans it will begin policing marketing materials more closely,” the Times reports. “Starting next open enrollment, Medicare will review and approve television advertisements before they air to make sure celebrities accurately describe the plans’ benefits.”
Quotes of the Day
“We cannot live with this crippling debt. If they don't get their house in order — if we don't look at the trust funds that are going bankrupt, whether it be Medicare, Medicaid, Social Security, Highway … If we can’t come to grips of how we face the financial challenges this country has, then we’re all going to be paying a price that we can’t afford.”
– Sen. Joe Manchin (D-WV), at a Fortune conference Thursday, calling for Congress to address the finances of Social Security, Medicare and Medicaid in a bipartisan fashion. Manchin’s comments come as President Joe Biden and other Democrats have been warning that Republicans looking to rein in federal spending will slash popular safety net programs.
“I always say, ‘Republicans like to spend money, too.’ So we’ll see how much they are able to rein in the spending.”
— Republican economic activist Stephen Moore, who served as an adviser to former president Donald Trump. Moore told The Washington Post that he has advised Republicans to avoid talking about making cuts to Medicare and Social Security, presumably for political reasons, and to focus instead on reducing federal spending provided by the Inflation Reduction Act, including additional funding for the IRS and grants supporting the development green energy technologies.
States Have Received $800 Billion in Pandemic Aid: Report
The federal government has sent about $800 billion to the states to boost local economies and help cover the cost of fighting Covid-19, according to a new report from Pew Charitable Trusts. That means that states have received a bit more than one of out every six dollars from the $5.2 trillion provided by Congress overall in response to the pandemic.
“Legislation in response to the pandemic spanned administrations and provided aid to states in numerous ways, including funding for new programs and for existing ones that, like Medicaid, often get a boost during economic downturns,” Pew’s Rebecca Thiess and Madalyn Bryant write. “Although dollars went to support programs in each major area of budgeting, flexible pots of money in the Coronavirus Relief Fund and the State and Local Fiscal Recovery Fund—which together totaled $307 billion for states—were the largest category of funding going to states.”
The funds were provided by eight separate bills, the largest portion of which was the $433 billion in the American Rescue Plan Act of March 2021. Other major bills include the $151 billion Coronavirus Aid, Relief, and Economic Security Act and the $60 billion Families First Coronavirus Response Act, both signed into law in March 2020.
Overall, the federal aid to states was unprecedented in size and far larger than the funds provided during the Great Recession of 2007-2009 (see the chart below). “Increased federal aid to states during a time of crisis is common, but the response to COVID-19 has seen an infusion of dollars that will have reverberating effects for years to come,” the Pew analysts write. “The long-term impact of this funding is unknown, but states have opportunities to approach this unprecedented time with tools for sound fiscal planning as they navigate decision-making around these new federal funding streams.”
Number of the Day: $16.7 Billion
Political spending on the 2022 midterm elections is projected to total $16.7 billion, The New York Times reports, citing an estimate from Open Secrets, a nonpartisan group tracking money in politics. That spending would set a new record for midterms, topping the $14 billion high set in 2018. Of the record $7.5 billion already spent on federal contests this cycle, 15.4% has come from billionaires and 38% has come from the top 1% of donors when measured by income, the Times’s Jonathan Weisman and Rachel Shorey report. “While both parties have their billionaires, Republicans have many more,” they write. “Of the 25 top donors this cycle, 18 are Republican, according to Open Secrets, and they have outspent Democrats by $200 million. Billionaires make up 20 percent of total Republican donations compared with 14.5 percent of Democratic donations.”
- GOP Congressional Majorities Would Pivot to Spending Cuts, Biden Probes – Washington Post
- GOP Floats Medicare Changes While Ducking Details – Axios
- Manchin Wants Deal on Debt, Social Security, Medicare and Medicaid – Bloomberg
- New Tax Break for Clean Energy Draws Scrutiny – New York Times
- The $24 Trillion Market That Predicts and Influences Interest Rates – New York Times
- Inside the Biden Team’s Fixation on Gas Prices – Washington Post
- CDC Updates Opioid Prescribing Guidelines With New Recommendations – CNN
- Trump Closes Out Midterms by Eyeing Impeachment of Mitch McConnell – New Republic
- Billionaire GOP Donors Overwhelm Democrats in Reversal of 2018 – Bloomberg
- Slightly Fewer Americans Applied for Jobless Aid Last Week – Associated Press
- Anxious Americans Disillusioned by Economy Ahead of Midterms – Axios
Views and Analysis
- Biden’s Warning About Democracy Will Go Unheeded – Francis Wilkinson, Bloomberg
- The G.O.P. Plot Against Medicare and Social Security – Paul Krugman, New York Times
- What You Can Expect if Republicans Take the House – Josh Chafetz, New York Times
- What Americans Think a GOP Congress Would Do Depends on Their Party – Philip Bump, Washington Post
- Republicans’ Plan to Fix the Economy Is … We’re Still Waiting – Allison Schrager, Bloomberg
- Republicans Are Just a Normal Polling Error Away From a Landslide — or Wiping Out – Nathaniel Rakich, FiveThirtyEight
- Will Slower Wage Growth Dampen Inflation? – Jason Furman, Peterson Institute for International Economics
- Here’s How the US Can Stop Wasting Billions of Dollars on Each Transit Project – Aaron Gordon, Vice
- The New Covid Boosters Are Incredible, and Everyone Should Get One – Bryce Covert, New York Times