Press Release             

Contact: Akiko Takano
Deputy Director of Communications

April 7, 2008

Groups Urge Congress to Stop Overpayments to Medicare Private Health Plans

Subsidies Lead to Marketing Abuse; Stronger Consumer Protections Needed

New York, NY - Ten national organizations have called on Congressional leaders to stop the Bush Administration's continuing overpayments to insurance companies that are leading the Administration's efforts to privatize Medicare.

The letter, signed by the AFL-CIO, AFSCME, the National Committee to Preserve Social Security and Medicare and the Medicare Rights Center, among others, asked Congress to rein in excessive taxpayer subsidies to insurance companies that provide Medicare private health plans and to protect consumers from the aggressive and deceptive marketing of these so-called "Medicare Advantage" plans.

The letter was timed to coincide with today's scheduled announcement by the Centers for Medicare & Medicaid Services of the minimum increase in payment benchmarks for local Medicare Advantage plans in 2009.

"The continuing overpayments to Medicare private health plans, which now average 13 percent more per enrollee than Original Medicare, is evidence of Congress's continuing failure to serve as a steward of Medicare, which tens of millions of Americans rely on for good health care. There is still time in 2008 for Congress to begin to level the playing field between private plans and Original Medicare and to put an end to the marketing abuse that is fueled by these excessive corporate subsidies," said Robert M. Hayes, President of the Medicare Rights Center.

The Medicare Rights Center is a national, not-for-profit consumer service organization that works to ensure access to affordable health care for older adults and people with disabilities through counseling and advocacy, educational programs, and public policy initiatives. The Medicare Rights Center has been at the forefront of efforts to call attention to the marketing misconduct by Medicare private health plans and to urge CMS to put in place procedures that allow consumers to return to Original Medicare when they are deceived or bullied into a private plan. Together with California Health Advocates, the Medicare Rights Center published two reports on marketing abuse by Medicare Advantage plans and a third report detailed the difficulties consumers can face because of the lack of standardized minimum benefit packages under the Medicare Advantage program. Those reports are available at Today's letter is available at

To learn more about Original Medicare and Medicare private health plans, log on to Medicare Interactive Counselor at the Medicare Rights Center's website at

Medicare Rights Center (MRC) is the largest independent source of health care information and assistance in the United States for people with Medicare. Founded in 1989, MRC helps older adults and people with disabilities get good, affordable health care.