There was once an insurance option for older Americans that promised to be better than Medicare, that offered certain “advantages” over the traditional version of the government health plan. In fact, it was named “Medicare Advantage,” or “MA,” for short. MA was very popular. For years, it provided what Medicare couldn’t and actually paid up when a claim was made. But, oh, how the mighty have fallen; and what was once a popular plan is now seen by many a provider as a source of great vexation.
Becker’s ASC Review recently catalogued the current view of Medicare Advantage from the perspective of three provider types: ambulatory surgery centers (ASCs), hospitals and physicians. We thought it might be enlightening to provide a summary of their findings.
Surgery Center Shortchanging
It comes as no news that Medicare has been less inclined to provide positive reimbursement updates to ASCs than they have for hospitals. And the treatment surgery centers have received by Medicare Advantage has been no better. Significantly, ASC administrators have cited “reimbursement denials, escalating implant costs and administrative hurdles,” when it comes to their current challenges.
Andrew Lovewell, CEO of Columbia Orthopaedic Group in Missouri, issued the following statement:
Many of the Medicare Advantage plans in our market are trying to pay below the Medicare physician fee schedule, and none of them are accounting for the implant costs associated with doing surgery in our ASC. I am also looking for steerage from the payers for ASC strategies in our market. As the low-cost/high-value provider in the market, we should see significant streerage to our facility but have not experienced that yet. With our clinical outcomes both surgically and non-operatively, we are the best value around.
As a result of these and other stressors, five health systems with ASCs have dropped or plan to drop MA plans within the year.
Hospital Hopelessness
While hospitals have received positive updates to their Medicare reimbursement rates over the last few years, these institutions are still struggling as it concerns MA programs. The problem has become so acute that some hospitals are considering dropping the program altogether due to rising administrative and financial burdens. A recent report from S&P Global noted that there are “growing risks to reimbursement from MA plans relative to traditional Medicare, as well as the payment risk and higher complexity around prior authorization requirements." The report went on to express concerns about the program’s “higher-than-expected spending.”
Hospitals have cited issues with UnitedHealthcare (UHC) MA plan, in particular. Here is an example: Becker’s reports that, by May 30, 2025, patients with commercial and Medicare Advantage coverage from UHC will be out-of-network with Carson Tahoe Health in Carson City, Nevada, which includes two hospitals and a 20-location provider network. The system has cited issues with prior authorizations and referrals, delays in care and strain on time and financial resources. The CFO for that health system stated the following:
This has a huge negative community impact, a negative financial impact and a negative patient care impact. At some point, UnitedHealth has to be held accountable. This is probably one of the worst situations a CFO can be in. I know this doesn't bode well, but nor does fighting for dollars we're expecting or putting patient care second.
Doctor Dismay
Physician practices have also begun cutting ties with MA, citing declining reimbursements, as well as patient care issues. One neurosurgeon at Craniospinal Center of Los Angeles stated his group is no longer accepting Medicare Advantage, noting that “The restrictions regarding these plans have made taking care of patients extremely cumbersome." He went on to cite what he termed as "ridiculous" denials of routine procedures, along with payment issues, i.e., "late or no payment at all.”
Another doctor, Susan Baumgartel, MD, of Seattle, left her job at a multispecialty group in part due to increasing pressure to accept and bill patients under Medicare Advantage, paired with the existing decreases to the physician fee schedule. She is just one of many physicians who have expressed their increasing frustration over trying to get paid when the patient is a beneficiary of MA.
As Becker’s put it, “ASCs, hospitals and physicians have all struggled with declining reimbursements, patient care issues and administrative burdens associated with Medicare Advantage plans—pushing some to drop the program entirely.” Here’s hoping that such actions on the part of providers will cause MA to look in the mirror and reevaluate their current strategies and processes. After all, the obnoxious guy sometimes returns to his good-guy roots.