Market Institute President Charles Sauer argues in a new Daily Caller op-ed that Washington’s crackdown on healthcare waste should turn next to Medicare Advantage.
Vice President JD Vance’s anti-fraud task force has recently targeted improper enrollment and fraud across federal healthcare programs. Sauer writes that Medicare Advantage presents an even larger opportunity for reform because the program’s reimbursement structure can reward insurers for making patients appear sicker on paper, increasing government payments without necessarily reflecting additional care.
The scale is significant. Sauer notes that questionable coding practices in Medicare Advantage are estimated to cost taxpayers roughly $22 billion in 2026. A federal Inspector General report also found billions of dollars in Medicare Advantage payments connected to diagnoses that were not followed by related medical visits, tests, or procedures.
Sauer calls for a two-part response: stronger enforcement against fraudulent coding by the Department of Justice and Department of Health and Human Services, combined with congressional reforms aimed at changing the incentives that encourage aggressive upcoding.
One proposal is the No UPCODE Act, which would restrict the use of diagnoses gathered through certain health risk assessments and chart reviews when determining Medicare Advantage payments.
Medicare Advantage remains popular with millions of seniors, but protecting the program does not require protecting bad incentives. Eliminating payments that are unsupported by actual medical care can reduce taxpayer costs while strengthening the program for beneficiaries who depend on it.
As Sauer writes, policymakers looking for the next major source of healthcare waste do not have to look very far.
Read Charles Sauer’s full column in the Daily Caller.
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