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How Trump Could Line the Pockets of Medicare Advantage Giant
"UnitedHealth would be empowered by Trump's Project 2025 to harm more Americans than virtually any other private corporation, other than fossil fuel companies, that benefits from his plan."
Oct 16, 2024
Responding to UnitedHealth Group's third quarter results this week, People's Action highlighted how the insurance giant would benefit from Project 2025, the right-wing policy agenda that critics fear will be implemented if former Republican President Donald Trump returns to the White House.
"The underlying businesses, which generated more than $100 billion in revenue in the quarter, helped overcome $475 million in total cyberattack impacts in the quarter," Forbesnoted Tuesday, citing the company earnings report. "Net income was $6.06 billion."
In a series of social media posts about those figures, People's Action said: "What they didn't mention? Much of that is public money. Funds meant to care for seniors and people with disabilities are lining the pockets of their executives and Wall Street investors. Money that instead UnitedHealth Group executives use to build mansions or send to Wall Street."
"UnitedHealth would be one of the largest financial beneficiaries of Project 2025."
People's Action also linked to its new report laying out how the company and its subsidiary UnitedHealthcare would likely benefit from the Heritage Foundation-led Project 2025, an initiative that Trump has tried to disavow even though its policy agenda's authors include at least 140 people who served in his first administration.
Specifically, the Tuesday report focuses on Medicare Advantage, an alternative to the government-run healthcare program that is administered by private companies. As Common Dreams has detailed, Project 2025 proposes making the privatized plans the default option for enrollees.
"UnitedHealth would be one of the largest financial beneficiaries of Project 2025, since it is the largest private health insurance corporation in America, the fourth-largest company in the country, and the largest writer of privatized Medicare Advantage plans, with 7.8 million people insured through a UnitedHealthcare Medicare Advantage plan," People's Action said.
The group pointed out that "UnitedHealthcare's revenue from Medicare Advantage, an estimated $137 billion, could be expected to double to $274 billion annually as a result of Project 2025."
"Because of UnitedHealth's massive scale, the harm it causes through its denials of care is unprecedented—whether through prior authorization denials, claim denials, and inadequate networks that prevent beneficiaries from receiving care or increase the financial strain of receiving care," the report warns. "UnitedHealth would be empowered by Trump's Project 2025 to harm more Americans than virtually any other private corporation, other than fossil fuel companies, that benefits from his plan."
As People's Action explained:
UnitedHealthcare would be expected to cover 15.6 million people via its Medicare Advantage plans as the eventual result of Project 2025's passage with a Trump victory. The Office of the Inspector General of the Department of Health and Human Services found that Medicare Advantage organizations (of which UnitedHealthcare is the largest) improperly denied care (prior-authorization denial) 13% of the time and denied payment for care improperly 18% of the time. Because this is a denial rate per procedure, not per person, an estimated 33% of people covered by Medicare Advantage experience a denial by their privatized insurer annually. With Project 2025's implementation that would mean 5.2 million people would be denied care by UnitedHealthcare alone. This figure is well above traditional Medicare denial rates due to inappropriate denials and denials outside the scope of traditional Medicare rules.
On social media, People's Action shared stories of actual patients, emphasizing that denials impact "people like Jenn Coffey, who constantly battles UnitedHealthcare for prior authorizations for the infusions that keep her alive after multiple fights with breast cancer."
"Robin Ginkel, a teacher who needs back surgery to be able to work again, faces the same fight for care," the organization said.
"We can stop this. Fight back against the full privatization of Medicare by corporations like UnitedHealthcare and UnitedHealth Group," People's Action urged. "Join us to deep canvass and protect care for ALL."
Underscoring Medicare defenders' warnings about Trump—who is facing Democratic Vice President Kamala Harris in the November 5 election, for which early voting is already underway—Mother Jonesreported Wednesday that a pro-Trump super political action committee sent out an alarming mailer to older voters in Arizona saying that Medicare had been canceled.
According to David Corn, the magazine's Washington, D.C. bureau chief:
It had a big red stamp that proclaimed, "Medicare Cancellation Notice." Also emblazoned on its front was this: "Warning: Rates are going up and plans are being canceled. Details enclosed." Its return address was the "Department of Medicare Cancellation, Kamala Harris Administration."
That return address should have been a tip-off that this was not an official notification—along with a scrawled add-on in cursive: "I hope you can afford to lose your insurance! —Kamala Harris XOXO."
It's hard to know whether any recipient saw this and received a shock, fearing their Medicare was being cut off. But the group that sent out this official-looking piece of campaign literature, Make America Great Again, Inc., a pro-Trump super PAC, was spreading false and misleading information about Medicare and about Harris.
Sharing the reporting on social media, Corn said that it was "rather odious for oligarchs to be scaring folks."
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FTC Sues Big Pharma Middlemen for Inflating Insulin Prices
"Caremark, ESI, and Optum—as medication gatekeepers—have extracted millions of dollars off the backs of patients who need lifesaving medications," said one agency leader.
Sep 20, 2024
The Federal Trade Commission on Friday initiated a legal process against middlemen that collectively administer about 80% of all prescriptions in the United States, accusing them of artificially inflating the list price of insulin drugs and blocking patients from accessing cheaper products.
The FTC action targets the "Big Three" pharmacy benefit managers (PBMs): CVS Health's Caremark Rx, Cigna's Express Scripts (ESI), and UnitedHealth Group's OptumRx. It also involves their affiliated group purchasing organizations (GPOs): Zinc Health Services, Ascent Health Services, and Emisar Pharma Services.
"Millions of Americans with diabetes need insulin to survive, yet for many of these vulnerable patients, their insulin drug costs have skyrocketed over the past decade thanks in part to powerful PBMs and their greed," said Rahul Rao, deputy director of the FTC's Bureau of Competition.
"Caremark, ESI, and Optum—as medication gatekeepers—have extracted millions of dollars off the backs of patients who need lifesaving medications," Rao continued. "The FTC's administrative action seeks to put an end to the Big Three PBMs' exploitative conduct and marks an important step in fixing a broken system—a fix that could ripple beyond the insulin market and restore healthy competition to drive down drug prices for consumers."
The FTC's vote to begin the legal process by filing a complaint was 3-0. Led by Chair Lina Khan, the Democrats supported the move while the two Republicans, Commissioners Melissa Holyoak and Andrew N. Ferguson, recused.
The American Prospect executive editor David Dayen noted that "the complaint, which was filed in an administrative court, has not yet been made public, as it is undergoing redactions. Agency officials expect it to be made public on Monday."
However, in a statement after the vote, the FTC shared some details about the complaint's arguments that "Caremark, ESI, and Optum and their respective GPOs engaged in unfair methods of competition and unfair acts or practices under Section 5 of the FTC Act by incentivizing manufacturers to inflate insulin list prices, restricting patients' access to more affordable insulins on drug formularies, and shifting the cost of high list price insulins to vulnerable patient populations."
Rao emphasized that while the commission on Friday "exercised its discretion to move forward with suing only the PBMs and GPOs now, FTC staff's investigation has also shed light on the concerning and active role that the insulin manufacturers—Eli Lilly, Sanofi, and Novo Nordisk—play in the challenged conduct."
"All drug manufacturers should be on notice that their participation in the type of conduct challenged here can raise serious concerns, with a potential for significant consumer harm, and that the Bureau of Competition reserves the right to recommend naming drug manufacturers as defendants in any future enforcement actions over similar conduct," he said.
Emma Freer, senior policy analyst for healthcare at the American Economic Liberties Project, pointed out that "the FTC's case adds to the mounting, bipartisan criticism of the 'Big Three' PBMs, which for far too long have exploited their monopoly power to inflate drug prices and enrich shareholders at the expense of patients' health and pocketbooks."
"The lawsuit also exposes their industrywide abuse, using insulin—the price of which has soared over 1,200% since 1999—as a flagship example of how PBMs' rebate schemes distort markets and drive up costs for lifesaving drugs," Freer said. "While PBMs bear much of the blame, the FTC is right to also put brand-name manufacturers like Eli Lilly, Novo Nordisk, and Sanofi on notice for their role in this crisis. We're thrilled to see the commission bring this long overdue challenge against healthcare's most notorious middlemen, and hope to see it result in concrete reform and accountability."
As The New York Timesreported:
Just weeks before the presidential election, the agency is tackling an issue that Vice President Kamala Harris has signaled an interest in. Campaigning at a community college in Raleigh, North Carolina, in August, Ms. Harris promised to "demand transparency from the middlemen who operate between Big Pharma and the insurance companies, who use opaque practices to raise your drug prices and profit off your need for medicine."
Former President Donald J. Trump has not campaigned on the issue, but in 2018, his administration proposed a sweeping change that would have threatened the benefit managers' business model. The proposal was never enacted. Mr. Trump's administration also created a model for capping Medicare patients' out-of-pocket costs for some insulin products that was later expanded under President [Joe] Biden.
The Times also noted that "some Republicans in Congress have proposed curbing some of the benefit managers' business practices. But other top Republicans have defended PBMs and said the FTC is overreaching."
Among the GOP's critics of PBMs is House Committee on Oversight and Accountability Chairman James Comer (R-Ky.), who highlighted his panel's investigations into the companies and praised the FTC move.
Another leading congressional critic of PBMs—and the country's failing for-profit healthcare system more broadly—is Senate Committee on Health, Education, Labor, and Pensions (HELP) Chair Bernie Sanders (I-Vt.), who caucuses with Democrats.
After a public pressure campaign led Eli Lilly, Novo Nordisk, and Sanofi to cut list prices of insulin products last year, Sanders held a hearing with their CEOs as well as PBM executives. At the time, he welcomed the voluntary reductions but also stressed that as "Americans pay outrageously high prices for prescription drugs, the pharmaceutical industry and the PBMs make enormous profits."
While the FTC's Friday action was widely praised—other than by the PBMs, who denied the allegations—some advocates hope the commission and other decision-makers will go even further in the future.
Stacy Mitchell, co-executive director of the Institute for Local Self-Reliance, called PBMs "some of the most predatory corporations in healthcare" and highlighted that "these companies have incredibly long rap sheets and convictions at the state level."
"I'm thrilled the FTC is going after these criminal enterprises," she said. "I hope this lawsuit, with its focus on kickbacks, is just the beginning. We also need action on how PBMs harm local pharmacies. Ultimately, these corporations need to be broken up."
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UnitedHealth Reports $7.9 Billion in Q2 Profits After Protesters Arrested
"Health insurance coverage has expanded in America, but we are finding it is private health insurance corporations themselves that are often the largest barrier for people," said one organizer.
Jul 16, 2024
A day after 150 people assembled outside the headquarters of UnitedHealth Group to demand the for-profit health insurance giant stop its "systemic" denial of coverage, the company announced Tuesday the huge profits it raked in over the second quarter of 2024: $7.9 billion.
The sum, said one organizer, exemplifies why the demonstrators were willing to risk arrest to speak out against the firm's practices.
"UnitedHealth Group's $7.9 billion quarterly profit announcement is the result of a business model built on pocketing premiums and billions of dollars in public funds, then profiting by refusing to authorize or pay for care," said Aija Nemer-Aanerud, Health Care for All campaign director for People's Action Institute. "People should not have to turn to public petitions or direct actions to get UnitedHealthcare to pay for the care they need to live. That makes no sense, unless you're a shareholder or executive eyeing your next big luxury purchase."
Eleven people were detained by police at Monday's demonstration, where they blocked the street in front of UnitedHealth's headquarters in Minnetonka, Minnesota, displaying signs that read, "United (Denies) Healthcare" and "The Price Is Wrong."
The demonstration was organized by the Care Over Cost campaign at People's Action Institute, which has worked to help people across the country overturn care denials by UnitedHealth and other for-profit insurance giants.
Gina Morin of Auburn, Maine spoke at the event about having her mental health treatment denied by her Medicare Advantage plan administered by UnitedHealth.
"Two years ago my therapist was denied payment for seven of my mental health sessions she provided," she said. "I tried to pay her even though I'm on a limited income and she wouldn't take the money. If my provider, in her professional opinion, believed I needed those therapy sessions, who is UnitedHealth to deny coverage?"
As Common Dreams reported last month, UnitedHealth was named in a letter written by 52 members of the Democratic caucus in Congress as one of the healthcare companies that use artificial intelligence to decide via algorithm that coverage should be provided or denied to patients who have Medicare Advantage plans, which are billed as offering coverage that traditional Medicare doesn't include.
ProPublicareported last year on Christopher Naughton, a man with ulcerative colitis whose treatment cost $2 million per year, leading UnitedHealth to flag his account as "high dollar." The company contracted with a doctor to review Naughton's case, and the doctor found the treatment for symptoms including arthritis, debilitating diarrhea, and blood clots was "not medically necessary."
After suing the company, Naughton's family found UnitedHealth had lied about what Naughton's personal physician told the contractor in order to come to their conclusion and end coverage.
"Health insurance coverage has expanded in America, but we are finding it is private health insurance corporations themselves that are often the largest barrier for people to receive the care they and their doctor agree they need," Nemer-Aanerud toldCBS News Monday.
In April, People's Action sent a letter to UnitedHealth noting that its CEO was paid nearly $10 million in 2022 while the CEO of its parent company "extracted over $90 million in executive and board pay for himself" over four years.
The company took $22.4 billion in profits in 2023 and sent $14.8 billion to shareholders through stock buybacks and dividends—yet continues to deny necessary healthcare coverage to its members.
The group called on UnitedHealth to:
- Stop denying claims and overturn any existing denials for treatments recommended by medical professionals;
- Immediately cease the practice of using artificial intelligence and algorithms to initiate claims denials in bulk; and
- Execute a publicly shared audit and reimburse federal and state governments for the public money diverted by claim and prior-authorization denials within Medicaid (Managed Care), and Medicare (Medicare Advantage), among other demands.
"We will never stop fighting for a world where everyone gets the care they need, no matter their race, gender, or background," said People's Action. "When greedy corporations deny our care, we organize."
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