A wide-ranging lawsuit filed Friday outlines a moneymaking scheme by which large insurance sales agency call centers enrolled people into Affordable Care Act plans or switched their coverage, all without their permission.

According to the lawsuit, filed in U.S. District Court for the Southern District of Florida, two such call centers paid tens of thousands of dollars a day to buy names of people who responded to misleading advertisements touting free government “subsidies” and other rewards. In turn, sales agents used the information to either enroll them in ACA plans or switch their existing policies without their consent.

As a result, the lawsuit alleges, consumers lost access to their doctors or medications and faced financial costs, such as owing money toward medical care or having to repay tax credits that were paid toward the unauthorized coverage.

Some consumers were switched multiple times or had duplicative policies.

“We allege there was a plan that targeted the poorest of Americans into enrolling in health insurance through deceptive ads and unauthorized switching,” to gain compensation for the sign-ups or capture the commissions that would have been paid to legitimate insurance agents, said Jason Doss, one of two lawyers who filed the case following a four-month investigation.

Doss and Jason Kellogg, the other lawyer on the case, which was filed on behalf of several affected policyholders and agents, are seeking class action status.

KFF Health News has in recent weeks reported on similar concerns raised by consumers and insurance agents.

Named as defendants are TrueCoverage and Enhance Health, which operate insurance call centers in Florida and other states; Speridian Technologies, a New Mexico-based limited liability company that owns and controls TrueCoverage; and Number One Prospecting, doing business as Minerva Marketing, which is also a lead-generating company. The lawsuit also names two people: Brandon Bowsky, founder and CEO of Minerva; and Matthew Herman, CEO of Enhance Health. Attempts to reach the companies for comment were unsuccessful.

According to the lawsuit, the call centers had access to policyholder accounts through “enhanced direct enrollment” platforms, including one called Benefitalign, owned by Speridian.

Such private sector platforms, which must be approved by the Centers for Medicare & Medicaid Services, streamline enrollment by integrating with the federal ACA marketplace, called healthcare.gov. The ones included in this case were not open to the public, but only to those call center agencies granted permission by the platforms.

One of the plaintiffs, Texas resident Conswallo Turner, signed up for ACA coverage in December through an agent she knew, and expected it to go into effect on Jan. 1, according to the lawsuit. Not long after, Turner saw an ad on Facebook promising a monthly cash card to help with household expenses.

She called the number on the ad and provided her name, date of birth, and state, the lawsuit says. Armed with that information, sales agents then changed her ACA coverage and the agent listed on it five times in just a few weeks, dropping coverage of her son along with way, all without her consent.

She ended up with a higher-deductible plan along with medical bills for her now-uninsured son, the lawsuit alleges. Her actual agent also lost the commission.

The lawsuit contains similar stories from other plaintiffs.

The routine worked, it alleges, by collecting names of people responding to online and social media ads claiming to offer monthly subsidies to help with rent or groceries. Those calls were recorded, the suit alleges, and the callers’ information obtained by TrueCoverage and Enhance Health.

The companies knew people were calling on the promise “of cash benefits that do not exist,” the lawsuit said. Instead, call center agents were encouraged to be “vague” about the money mentioned in the ads, which was actually the subsidies paid by the government to insurers toward the ACA plans.

The effort targeted people with low enough incomes to qualify for large subsidies that fully offset the monthly cost of their premium, the lawsuit alleges. The push began after March 2022, when a special enrollment period for low-income people became available, opening up a year-round opportunity to enroll in an ACA plan.

The suit asserts that those involved did not meet the privacy and security rules required for participation in the ACA marketplace. The lawsuit also alleges violations of the federal Racketeer Influenced and Corrupt Organizations Act, known as RICO.

“Health insurance is important for people to have, but it’s also important to be sold properly,” said Doss, who said both consumers and legitimate agents can suffer when it’s not.

“It’s not a victimless crime to get zero-dollar health insurance if you don’t qualify for it and it ends up causing you tax or other problems down the road,” he said. “Unfortunately, there’s so much fraud that legitimate agents who are really trying to help people are also being pushed out.”

KFF Health News is a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF—an independent source of health policy research, polling, and journalism. Learn more about KFF.

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The Host Julie Rovner KFF Health News @jrovner Read Julie's stories. Julie Rovner is chief Washington correspondent and host of KFF Health News’ weekly health policy news podcast, “What the Health?” A noted expert on health policy issues, Julie is the author of the critically praised reference book “Health Care Politics and Policy A to Z,” now in its third edition.

Florida this week became a major focus for advocates on both main sides of the abortion debate. The Florida Supreme Court simultaneously ruled that the state’s 15-week ban, passed in 2022, can take effect immediately before a more sweeping, six-week ban replaces it in May and that voters can decide in November whether to create a state right to abortion.

Meanwhile, President Joe Biden, gearing up for the general election campaign, is highlighting his administration’s health accomplishments, including drug price negotiations for Medicare.

This week’s panelists are Julie Rovner of KFF Health News, Joanne Kenen of the Johns Hopkins University schools of nursing and public health, Tami Luhby of CNN, and Lauren Weber of The Washington Post.

Panelists Joanne Kenen Johns Hopkins Bloomberg School of Public Health and Politico @JoanneKenen Read Joanne's articles. Tami Luhby CNN @Luhby Read Tami's stories. Lauren Weber The Washington Post @LaurenWeberHP Read Lauren's stories.

Among the takeaways from this week’s episode:

• The Florida Supreme Court’s decisions this week will affect abortion access not only in the state, but also throughout the region. Florida’s six-week ban, which takes effect on May 1, would leave North Carolina and Virginia as the only remaining Southern states offering the procedure beyond that point in pregnancy — and, in North Carolina, abortion is banned at 12 weeks after a woman’s last menstrual period.
• Since the U.S. Supreme Court overturned the constitutional right to an abortion in 2022, six states have voted on their own constitutional amendments related to abortion access. In every case, the side favoring abortion rights has won. But Florida’s measure this fall will appear on the ballot with the presidential race. Could the two contests, waged side by side, boost turnout and influence the results?
• Former President Donald Trump made many attempts during his term to undermine the Affordable Care Act, and this week the Biden administration reversed another one of those lingering attempts. Under a new regulation, the use of short-term insurance plans will be limited to four months — down from 36 months under Trump. The plans, which Biden officials call “junk plans” due to their limited benefits, will also be required to provide clearer explanations of coverage to consumers.
• In other Biden administration news, March has come and gone without the release of an anticipated ban on menthol flavoring in tobacco, and anti-tobacco groups are suing to force administration officials to finish the job. Menthol cigarettes are particularly popular in the Black community, and — like Trump’s decision as president to punt a ban on vaping to avoid alienating voters in 2020 — the Biden administration may be loath to raise the issue this year. Activists say, however, that it may be at the expense of Black lives.
• “This Week in Medical Misinformation” looks at an article from PolitiFact about the health misinformation that persists even with the pandemic mostly in the rearview mirror.

Also this week, Rovner interviews health care analyst Jeff Goldsmith about the growing size and influence of UnitedHealth Group in the wake of the Change Healthcare hack.

Plus, for “extra credit” the panelists suggest health policy stories they read this week that they think you should read, too: 

Julie Rovner: Politico’s “Republicans Are Rushing to Defend IVF. The Anti-Abortion Movement Hopes to Change Their Minds,” by Megan Messerly and Alice Miranda Ollstein.

Tami Luhby: The Washington Post’s “Biden Summons Bernie Sanders to Help Boost Drug-Price Campaign,” by Dan Diamond.

Lauren Weber: The Washington Post’s “Bird Flu Detected in Dairy Worker Who Had Contact With Infected Cattle in Texas,” by Lena H. Sun and Rachel Roubein.  

Joanne Kenen: The 19th’s “Survivors Sidelined: How Illinois’ Sexual Assault Survivor Law Allows Hospitals to Deny Care,” by Kate Martin, APM Reports.

Also mentioned on this week’s podcast:

• KFF Health News’ “ACA Plans Are Being Switched Without Enrollees’ OK,” by Julie Appleby.
• KFF Health News’ “Your Doctor or Your Insurer? Little-Known Rules May Ease the Choice in Medicare Advantage,” by Susan Jaffe.
• Health Affairs’ “Will the Change Healthcare Incident Change Health Care?” by Jeff C. Goldsmith.
• The Health Care Blog’s “Optum: Testing Time for an Invisible Empire,” by Jeff Goldsmith.

click to open the transcript Transcript: Florida Limits Abortion — For Now

KFF Health News’ ‘What the Health?’Episode Title: Florida Limits Abortion — For NowEpisode Number: 341Published: April 4, 2024

[Editor’s note: This transcript was generated using both transcription software and a human’s light touch. It has been edited for style and clarity.] 

Julie Rovner: Hello, and welcome back to “What the Health?” I’m Julie Rovner, chief Washington correspondent for KFF Health News, and I’m joined by some of the best and smartest health reporters in Washington. We’re taping this week on Thursday, April 4, at 10 a.m. As always, news happens fast, and things might have changed by the time you hear this, so here we go.

We are joined today via video conference by Tami Luhby of CNN.

Tami Luhby: Good morning.

Rovner: Joanne Kenen of the Johns Hopkins University Schools of Nursing and Public Health and Politico magazine.

Joanne Kenen: Hi, everybody.

Rovner: And Lauren Weber, the Washington Post.

Lauren Weber: Hello.

Rovner: Later in this episode, we’ll have an interview with Health Policy Analyst and Consultant Jeff Goldsmith about the continuing fallout from the Change Healthcare hack. But first, this week’s news. One of these weeks, we won’t have to lead with abortion news, but this is not that week. On Monday, the Florida Supreme Court ruled separately, but at the same time, that state voters could decide this November whether to make a right to abortion part of the state’s constitution and that the state’s constitution currently does not guarantee that right.

So the state’s 15-week abortion ban signed by Gov. Ron DeSantis in April of 2022 can take immediate effect. But wait, there’s more. First, the decision on the 15-week ban overruled years of precedent that Florida’s Constitution did, in fact, protect the right to abortion. And second, allowing the 15-week ban to take effect automatically triggers an even more sweeping six-week ban that Gov. DeSantis signed in 2023. That will take effect May 1. That’s the one he signed in the middle of the night without an audience people may remember. And this is going to affect far more people than just the population of Florida, right?

Kenen: The whole South. This is it. If you count the South as North Carolina and what we think of as the South, North Carolina is the only state that still has legal abortion, and that is only up to 12 weeks. And there are some conditions and hurdles, but you can still get an abortion in North Carolina.

But to get from a place, people were going to Florida, it’s easier to get from Alabama to Florida than it is from Alabama to even Charlotte. I think I read it’s a 17-hour drive from Florida or something like that. I don’t remember. It’s long. So it’s not just people who live within Florida, but people who live in 11 or 12 states in the American South have far fewer options.

Rovner: And even though the Florida ban feels less than a complete ban because it allows abortions up to six weeks, the fine print actually makes this one of the most restrictive bans in the country. It looks, in effect, like most people won’t be able to get abortions in Florida at all.

Weber: I would say that’s right, Julie. And just to reiterate what Joanne said, 80,000 women get abortions in Florida every year. That’s about one in 12 women in America that get abortions per year, and they will no longer have that kind of access because, at six weeks, a lot of women don’t know they’re pregnant. So, I mean, that’s a very restrictive abortion ban.

Rovner: Remember that six weeks isn’t really six weeks of having been pregnant. Six weeks is six weeks since your last menstrual period, which can be as little as two weeks in some cases.

Kenen: And I also think that even if you do know within six weeks, getting an appointment, given how few places there are in the entire South, even if you know and you get on the phone right away, can you get an appointment before your six weeks is an additional challenge because access is really limited …

Rovner: Right.

Kenen: … intentionally.

Rovner: Yes, and we’ve seen this with other six-week bans. We should point out that some people consider Virginia the South still, and you can go to Virginia, but that’s basically the last place that a good chunk of the country, geographically, if not population-wise, would need to turn to in order to get an abortion.

Well, if that’s not all confusing enough, even if voters do approve the ballot measure in November, the Florida Supreme Court suggested it could still strike down a right to abortion based on a majority of justices findings that the state’s constitution could include personhood rights for fetuses.

I’m having trouble wrapping my head around why the justices would allow a vote whose results they might then overturn. But I guess this is part of the continuing evolution, if you will, to use that word, of this concept of personhood for fetuses and embryos, and what has us talking about IVF, right?

Weber: Yeah, absolutely. I think, as many conservative Christian groups will say, this is the natural line that pro-life is. I mean, they argue, and while they’re pushing this view is not necessarily held by the majority of constituents, but this is their argument that a fetus, an embryo, such as one that could be used in IVF, is a person.

And so, I mean, I think that’s kind of the natural conclusion of pro-life ideology as we’re seeing it right now. And I think it will have a lot of political effects going forward because that IVF is obviously much more popular than abortion. I think we’ll see a lot of voting firepower potentially used on that.

Rovner: Well, I’m so glad you said that because I want to turn to politics. Some Democrats are suggesting that this could boost turnout for Democrats and help, if not put Florida in play for president, maybe the Democrat running to unseat Senator Rick Scott, the Republican.

On the other hand, while abortion ballot questions have done very well around the country, as we know, even in states redder than Florida, there is evidence that some Republicans vote for abortion rights measures and then turn around and vote at the same time for Republicans who would then vote to overturn them.

There are in fact Florida abortion rights advocates who don’t want Democrats to make this issue partisan because they want Republicans to come and vote for the ballot measure, which needs a 60% majority to pass, even if those Republicans then go on to vote for other Republicans. So, who really is helped by this entire mess, or is it impossible to tell at this point?

Weber: I think it’s impossible to tell, but I do think what is complicating is we haven’t seen the presidential race thrown into these abortion ballots. I mean, what we’re looking at is two candidates who potentially are facing a lot of low turnout due to lack of enthusiasm in their bases for both of them. And I am curious if the abortion ballot measures could have much more of an impact on the presidential race than maybe some of these other lower-office races that we’ve seen. I think that’s the main question that I guess we’ll see in November.

Rovner: As we have spoken about many times, President Biden is not super comfortable talking about this issue. He’s an 81-year-old Catholic. It does not come naturally to him to be in favor of abortion rights, which he now is. But Vice President Harris has been sent out. She’s sort of become the standard-bearer for this administration on reproductive health issues, and she’s been very active. And Joanne, you wanted to say something?

Kenen: There are a couple of points. In addition to the abortion ballot initiative. There’s also a marijuana legalization. I think we will see higher turnout and particularly among younger people who have been pretty disaffected this election. So that’s one, whether it affects the presidential race, whether it affects the Senate race. I mean, just as Democrats feel really strong about abortion, Republicans feel really strong about immigration. We don’t know what’s going to happen in November, but I do think this boosts turnout. The second thing to remember, though, is in terms of abortion ballot initiatives have passed every time they’ve come up since the fall of Roe [v. Wade].

This is a 60% threshold, and I do not believe that any state has reached that. I think the highest was about 57%. So even though it may get well over 50, it could get 59.9, the Florida ballot initiative needs 60%. That is a tall order. So you might end up seeing a big turnout, a big pro-abortion rights vote, maybe a big legal weed vote, and the abortion measure could still fail. But I do think it definitely changes the dynamics of Florida from the presidential race on down the ballot. I do think it is a different race than we would’ve seen beforehand.

Rovner: And I will point out, since she didn’t, that Joanne has spent time covering Florida and covering the politics in Florida. So you know where of you speak on this.

Kenen: Well, I lived there for a while, though it was a while ago. The state has, in fact, changed like everything else, including me, right? But I’m somewhat familiar with Florida. I was just there a few weeks ago in fact.

Rovner: And I want to underscore something that Lauren said, which is that we’ve seen all of these ballot measures since Roe was overturned, but we have not seen these ballot measures stacked on top of the presidential race. So I think that will be interesting to watch as we go forward this year.

Well, back here in D.C., the Biden administration issued a long-awaited rule reigning in the use of those short-term health plans that Democrats like to call junk insurance and that President Trump had expanded when he was in office. Tami, what is the new rule, and what will it do?

Luhby: Well, it’s actually curtailing the short-term plans and pretty much reversing the Trump administration rule. So it’s the latest move by the president to contrast his approach to health care with that of former President Donald Trump. Trump extended the duration of the short-term health insurance plans to just under a year and allowed them to be renewed for a total of 36 months. And it was seen as an effort to weaken the Affordable Care Act, draw out younger people, make it more difficult for the marketplace, probably send the older, sicker people there, which would raise premiums, basically cause more chaos in the marketplace.

Rovner: Yeah. And remind us why these plans can be problematic.

Luhby: I will tell you that the short-term plans do not have to adhere to Obamacare’s consumer protections, which is the big difference. For instance, they’re not required to provide comprehensive coverage, and they can discriminate against people with pre-existing conditions, charge them more, deny them, et cetera. As I’d said, the Trump administration heralded them as a cheaper alternative because since they can underwrite, they have typically cheaper premiums. But they also have very limited benefits, or they can have limited benefits depending on the patient or the consumer.

So the Biden rule, which was proposed last month as a series of actions aimed at lowering health care costs, limits the duration of new sales of these controversial plans to three months, with the option of renewal for a maximum of four months. So it’s going on these new plans from 36 months potentially to four months, which was the original idea of these plans because originally they were thought to be for people who might be switching jobs or have a temporary lapse in coverage. They were not intended to be a substitute for full insurance. And it also requires, notably, that the plans provide consumers with a clear explanation of their benefits and inform them of how to find more comprehensive coverage.

Rovner: And obviously this will continue to be controversial, but I think the Democrats, in general, who support the Affordable Care Act feel pretty strongly that this is something that’s going to help them. And as we talked about, we’re not sure yet how the administration is going to play the abortion issue in the campaign, but it is pretty clear that they are doubling down on health care.

One problem for the administration, as we have talked about, is that particularly on really popular things like Medicare drug price negotiations, lots of the public has no idea that that’s happened or if it’s happened that it’s because the Democrats did it. So, in part of an effort to overcome that, Biden invited Bernie Sanders to the White House this week. What was that about?

Luhby: Well, that’s my extra credit. Would you like me to discuss that now?

Rovner: Sure, let’s do that now.

Luhby: OK. So my extra credit is a Washington Post story titled “Biden Summons Bernie Sanders to Help Boost Drug-Price Campaign,” by Dan Diamond. And I have to admit, I hope I can do that here, that I am a fangirl of Dan Diamond’s stories, and even more so now because apparently, the Biden administration gave Dan a heads-up in advance, that since he published a pretty in-depth story an hour before the embargo lifted for the rest of us who were only given a few tidbits of information about what this meeting or what this speech was going to be about at the uncharacteristically late hour of 8:30 at night.

So Dan’s story looked at how the two former rivals, Joe Biden and [Sen.] Bernie Sanders, who were rivals in the 2020 Democratic presidential nomination, how they had very different views on how the nation’s health care system should operate and Dan’s story looked at how they were uniting to improve awareness of Biden’s efforts to lower drug prices and improve his chances in November. Biden invited Sanders to the White House to discuss the administration’s actions on drug prices, including the latest effort to reduce the out-of-pocket cost of inhalers, which really hasn’t gotten a lot of press.

Sanders brings his progressive credentials and his two-decade-plus track record of fighting for lower drug prices and, “naming and shaming individual pharmaceutical companies and executives.” He’s known to be pretty outspoken and fiery. So the story’s a good example of policy meets politics in an election year. It relays that most Americans still don’t know about the administration’s efforts despite the numerous speeches, news releases, and officials’ trips around the country, hence the need to tap Sanders, and it also provides a nice walk down memory lane, revisiting the duo’s battles in the 2020 primary as well as some of former President Trump’s drug price efforts.

Rovner: Yeah. And a little peek behind the journalistic curtain. I think we all got this sort of mysterious note from Sanders’ press people the night before saying, “If you’ll agree to our embargo, we’ll tell you about this secret thing that’s going to happen,” followed by an advisory from the White House saying that Bernie Sanders was coming to the White House to talk about drugs. [inaudible 00:13:30] …

Luhby: Right. And also, uncharacteristically, when I asked for a comment from Sanders directly, they said tomorrow, which is not like Sanders at all.

Kenen: Sanders and Biden were obviously opponents in the primary, but Sanders has really been very supportive of Biden. I think he’s really sort of highlighted the progressive things that Biden has done and stayed quiet about the more centrist things that Biden has done. He’s been a real ally, and he still has a lot of credibility, and I think they sort of like each other in a funny way. You can sort of see it, but that’s their issue.

Luhby: Biden has also been able to do things that other people have not been able to do with the congressional Democrats. Biden has been able to do things that congressional Democrats have tried to for years and have not been able to, and they may not be the extent to which the Democrats would like. If you remember the 2019 Medicare Drug Negotiation bill, I think, was 250 drugs a year. What ended up passing in the IRA [Inflation Reduction Act] was 10 drugs and ramping up, but at least it’s something.

Kenen: And it’s more than 20 years in the making. I mean, this goes way, way back.

Luhby: Mm-hmm.

Rovner: And I was going to underscore something that Joanne said earlier about Florida, which is that both sides are trying to gin up their base, and young people are really fond of Bernie Sanders in a lot of the things that he says, and this may be a way that Biden can ironically use the Medicare drug price negotiation issue to stir up his young person base to get them out to vote. So I was interested in the combination.

Kenen: So it’s Bernie Sanders and legal weed.

Rovner: That’s right. It’s Bernie Sanders and legal weed, at least in Florida.

Kenen: I’m not implying anything about Bernie Sanders’ use of it. It’s just the dynamic for the young voters.

Rovner: Yes. Things to draw young people out to the polls in November. Well, while the Biden administration is doing lots of things using its regulatory power, one thing it is not doing, at least not yet, is banning menthol flavoring in tobacco.

This is a regulation that’s now been sitting around for nearly two years and that officials had promised to finalize by the end of March, which of course was last week and which didn’t happen. So now three anti-tobacco groups have sued to try to force the regulation over the finish line. Somebody remind us why banning menthol is so very controversial.

Weber: It’s controversial in part because a lot of industry will say that banning menthol will lead to over-policing in Black communities. The jury is very much out on if that is an accurate representation or part of the cigarette playbook to keep cigarettes on the market. Look, a presidential election year and things to do with smoking is not new.

When I was at KFF Health News with Rachel Bluth back in the day, we wrote a story about how Trump postponed a vape ban to some extent because he was worried about vaping voters. So I mean, I think what you’re seeing is a pretty clear political calculus by the Biden folks to push this off into the new year, but as activists and public health advocates will say, it’s at the expense of, potentially, Black lives.

Rovner: That’s right.

Weber: So banning menthol cigarettes would really… what it would do is statistically save Black Americans who die from, predominantly from smoking these types of cigarettes. So it’s a pretty weighty decision to put off with a political calculus.

Rovner: He’s taking incoming from both sides. I mean, obviously, there are members of the Black community who say, as you point out, this could lead to an unnecessary crackdown on African American smokers who use menthol more statistically than anybody else does. Although, there’s some young people who use it too. On the other hand, you have people representing public health for the Black community saying, “We want you to ban this” because, as you point out, people are dying from smoking-related illnesses by using this product. So it’s a win-win, lose-lose here that is continuing on. We’ll be interested to see what, if the lawsuit can produce anything.

Well, speaking of things that are controversial, we also have Medicare Advantage. The private plan alternative to traditional Medicare now enrolls more than half of those in the program, many who like the extra benefits that often come with the plans and others who feel that they can’t afford traditional Medicare’s premiums and other cost-sharing. Except one reason those extra benefits exist is because the government is overpaying those Medicare Advantage plans. That’s a vestige of Republican plans to discourage enrollment in original Medicare that date back to the early part of this century.

So now taxpayers are footing more of the Medicare bill than they should. This week’s news is that the federal government is effectively trimming back some of those overpayments. And investors in the insurance companies, who make money from the overpayments, are going crazy. This is the subhead on a story from the Wall Street Journal, “Managed care stocks are set to fall due to disappointment with the government’s decision not to revise the 2025 Medicare payment proposal.” How is this ever going to get sorted out? Somebody always is going to be a loser in this game, either the patients or the insurance companies or the taxpayers. Everybody cannot win here.

Luhby: Right. And Humana got hit really hard when the rule came out because it is really focused on Medicare Advantage. So yeah, the insurers were hit, but as everything with the market, it’s not forever.

Rovner: I’m continually puzzled by … if the payments were equivalent, which was what they were originally supposed to be. Originally, originally back in the 1980s, insurance companies came to Congress and said, “We can provide managed care and Medicare cheaper, so you can pay us 95% of the average that you pay for a fee for service patient. We can make a profit on that.”

Well, that is long since gone. The question is how much more they will make. And as I point out, when they get overpaid, they do have to rebate those back effectively to the patients in terms of higher benefits. And that’s why many of them offer dental coverage and eyeglasses coverage and other types of, quote-unquote, extra benefits that Medicare doesn’t offer.

But also you get this lack of choice, and so we see when people try to leave these plans and go back to traditional Medicare, they can’t, which is only one of the sort of things that I think a lot of people don’t know about how Medicare Advantage works. Another place with an awful lot of small print.

Weber: It’s a lot of small print under a very good marketing name. The name itself implies that you’re making a better choice, but that isn’t necessarily what the small print would say.

Kenen: And there are people who are very satisfied with it and who get great care. I mean, it’s not monolithic. I mean, it is popular. It is growing and growing and growing. It’s partly economic, and there’s some plans that patients like, and there’s word of mouth or that were negotiated as part of union agreements and are actually pretty strong benefits. But they’re also people who are really encountering a lot of trouble with prior authorization, and limited networks, and your doctor’s no longer in it, et cetera, et cetera.

I think that those things, I actually checked with somebody about the provider networks, what we know about who’s dropping out, and I don’t think there’s really up-to-date data, but there is a perception, and you’re hearing it and seeing it online. But they do an incredible amount of marketing, an incredible amount of marketing. And if you’re in it and you like it and you save money and you’re getting great health care, terrific. You’re going to stay in it.

If you’re in it and you don’t like it and you’re not getting great health care and a lot of hassles or you can’t see the right doctors, it’s hard to get out and get back into it depending on what state you’re living … It’s not monolithic. But I think we might be between the financial pressures from the government and some of the debates about some of these things they’re doing there may be some reconsideration. But they have strong backers in Congress and not just Republicans.

Rovner: Oh, yeah. I mean, and as you point out, more than half of the people in Medicare are now on Medicare Advantage. I did want to sort of highlight my colleague Susan Jaffe, who has a story this week about the fact that patients can’t change plans in the middle of the year, but plans can drop providers in the middle of the year, so people may sign up for a health plan because their doctor or their hospital is in it and then suddenly find out mid-year that their doctor and their hospital is no longer in it.

There are occasionally, if you’re in the middle of treatment, there are opportunities sometimes to change, but often there aren’t. People do end up in these plans, and they can be happy for, basically, until they’re not, that there are trade-offs when you do it. And I think, as we point out, there’s so much marketing, and the marketing somehow doesn’t ever talk about the trade-offs that you make when you go into Medicare Advantage.

Luhby: Well, one also thing is that this is the peak 65 year, where the most baby boomers, and where are they coming from? They’re coming from private commercial insurance, so they’re familiar with it, and they were like, “Oh, OK, that’s seemingly very much like my employer plan. Sure, that sounds great. I know how to deal with that.” So that’s one of the things. And one cudgel that the insurers have is they say, “Oh, government, you’re going reduce our payments. We’re going to reduce the benefits and increase the premiums because we’re not going to have all of that extra government funding.” And that can scare the government because they don’t want the insurers to tell their patients, who are older patients who vote, “Oh, because of the government, we can no longer offer you all of these benefits, or we’ve had to raise your premium because of that.” So we’ll see if they actually do that.

Kenen: Joe Biden took away your gym, right?

Luhby: Exactly.

Rovner: [inaudible 00:22:11].

Luhby: And your dental benefits. So that’s always the threat that the insurers roll out. That’s the first thing that they say often, but we’ll see what happens. We don’t know yet until the fall, when enrollment starts, what will actually happen?

Rovner: We saw exactly that in the late ’90s after Congress balanced the budget. They took a big whack out of the payments for what was then, I think, called Medicare Plus Choice. It was the previous version of Medicare Advantage, and a lot of the companies just completely dropped out of the program. And a lot of the people, who as Joanne said, had been in those plants had been very happy, threw a fit and came to Congress to complain, and lo and behold, a lot of those payments got increased again. In fact, that was what led to the big increase in payments in 2003 was the huge cut that they made to payments, which drove a lot of the insurers out of the program. So we do know that the insurers will pack up and leave if they’re not paid what they consider to be enough to stay in the program.

Moving on. One of the things that Jeff Goldsmith talks about in this week’s interview is that our health system has become one of deep distrust between patients, providers, and insurers. Speaking of Medicare Advantage. That is sad and dysfunctional, except that sometimes there are good reasons for that distrust. One example comes this week from my KFF Health News colleague Julie Appleby. It seems that unscrupulous insurance brokers are disenrolling people in Obamacare plans from their health plans and putting them in different plans, which is unbeknownst to them until they find their doctor is no longer in their network or their drug isn’t covered.

The brokers who are doing this can earn bigger commissions. But patients can end up not just having to pay for their own medical care but owing the government money because suddenly they’re in plans getting subsidies that don’t match their incomes. It is a big mess. And it seems that the obvious solution, which would be making it harder for agents to access people’s enrollment information so they can switch them, would delay legitimate enrollment. It has to be easy for agents to basically manipulate people’s applications. So how do you guard against bad actors without inconveniencing everyone? This seems to be the question here and the question for Medicare Advantage, Lauren.

Weber: I was going to say, I mean, I think that’s the question Medicare itself has been dealing with for years. I mean, there’s a reason that many federal prosecutors call this a pay-and-chase situation in which there is rampant Medicare fraud. They prioritize the ease of patients accessing care to the disadvantage of some folks, or in this case, the American taxpayer, in this case, actual patients, being swindled.

But I don’t have an answer. I don’t think anyone really has an answer, considering we’re seeing things like the $2 billion catheter fraud that we’ve talked about here. So I think again, this is one of these things where the government’s been left a little flat-footed in trying to protect against bad actors.

Rovner: Yeah, well, the health sector is what a fifth of the economy now, so I guess it shouldn’t come as much of a surprise that you have not just bad actors, people who are making a lot of money from doing illegal things and find it to be worth their while and that some of them get caught, but presumably most of them don’t. I guess that’s what happens when you have that much money in one place, you need sort of better watchdogs. All right. Well, finally, this week in medical misinformation comes from PolitiFact in a story called “Four Years After Shelter-in-Place, Covid-19 Misinformation Persists.” That’s an understatement.

That last part was mine. At the top of the list says, “We have discussed before is growing resistance to vaccines in general, not just the covid vaccine,” which is not all that surprising considering how many people now believe fictitious stories about celebrities dropping dead immediately after receiving vaccines. There’s even a movie called “Died Suddenly.” Or that government leaders and the superrich orchestrated the pandemic. That’s another popular story that goes around. Or that Dr. Tony Fauci brought the virus to the United States a year before the pandemic. Lauren, health misinformation is your beat. Is it getting any better now that the pandemic is largely behind us, or is it just continuing unabated?

Weber: No, I would argue it’s possibly getting worse because the trust in institutions is at an all-time low. Social media has allowed for fire hose. I mean, it’s made everything … it’s made the public square that used to be more limited, all corners of the country.

I would say that misinformation has led to mistrust about basic medical things, including childhood vaccinations, but also other medical treatment and care. And I think you’re really seeing this kind of post-truth world post-covid, this distrust, this misinfo is going to continue for some time. And there’s too much to cover on my beat. There’s constantly stories around the bend, and I don’t expect that improving anytime soon.

Kenen: Every single time a celebrity, not just dies, because it’s always no matter what happens, it’s blamed on the covid vaccine, but also gets sick. I mean, Princess Kate. We don’t know everything about her health, but I mean, all of us know it wasn’t. Whatever it is, it’s not because the covid vaccine. But if you go online, you hear that that’s whatever she has it’s because she’s vaccinated.

And the other thing is it’s fed into this general vaccine mistrust. So when I wrote about the RSV vaccine, which we talked about a few weeks ago, it wasn’t so much that there’s a campaign against the RSV vaccine. There is somewhat of that. But it’s just this massive, “vaccines are bad.” So it’s spilling over into anything with a needle attached is part of this horrible plot to kill us all. So it’s just sort of this miasma of anti-vaccination that’s hovering over a lot of health care.

Rovner: Well, at the risk of getting a little too bleak, that will be the news for this week. Now, we will play my interview with Jeff Goldsmith, and then we’ll come back and do our extra credits. I am pleased to welcome back to the podcast Jeff Goldsmith, one of my favorite big-picture health system analysts. Jeff has been writing of late about the Change Healthcare hack and the growing size and influence of its owner, UnitedHealth Group, and what that means for the country’s entire health enterprise. Jeff, thanks for joining us again.

Jeff Goldsmith: You bet.

Rovner: So the lead of your latest piece gives a pretty vivid description of just how big United has become, and I just want to read it. “Years ago, the largest living thing in the world was thought to be the blue whale. Then someone discovered that the largest living thing in the world was actually the 106-acre, 47,000-tree Pando aspen grove in central Utah, which genetic testing revealed to be a single organism.

With its enormous network of underground roots and symbiotic relationship with a vast ecosystem of fungi, that aspen grove is a great metaphor for UnitedHealth Group. United, whose revenues amount to more than 8% of the U.S. health system, is the largest health care enterprise in the world.” Let’s pick up from there for people like me who haven’t been paying as much attention as maybe they should have, and still think that United is mainly a health insurance company. That is not true and hasn’t been for some time, has it?

Goldsmith: The difference between United and a health insurance company is that it also has $226 billion worth of care system revenues in it, some of which are services rendered to United and other, believe it or not, services rendered to United competitors. So, there isn’t anything remotely that size in the health insurance world. That $226 billion is more than double the size of Kaiser. Just to give you an idea of the scale.

Rovner: Which, of course, is the other companies that are both insurers and providers. That’s pretty much the only other really big one, right?

Goldsmith: Yes. I have a graphic in the piece that shows the Optum Health part, which is the care delivery part of Optum, is just about the same size as Kaiser, but it generates six and a half billion dollars in profit versus Kaiser’s $323 million. So it dwarfs Kaiser in terms of profitability even though it’s about the same size top line.

Rovner: So split it up for people who don’t know. What are sort of the main components that make up UnitedHealth Group?

Goldsmith: Well, there’s a very large health insurance business, $280 billion health insurance business. Then, there is a care system called Optum Health, which is about $95 billion. It has 90,000 affiliated or employed docs, a huge chain of MedExpress urgent care centers, surgery centers, a couple of very large home health care agencies. So that’s the care delivery part of United.

There’s Optum Insight, which is about $19 billion. That’s the part that Change Healthcare was inside of. It’s a business intelligence and corporate services business, and consulting business, that also manages care systems financials. And then, finally, there’s Optum Rx, which is about $116 billion, so a little bit more than half of Optum’s total, and that is a pharmacy benefit management company. Believe it or not, the third-largest one. So there are bigger pharmacy benefits management companies than Optum, but those are the three big pieces.

Rovner: I feel like this is almost as big as a lot of the government health programs, isn’t it?

Goldsmith: Yeah. I mean, I can’t remember top line how big the VA [Department of Veterans Affairs] is these days, but it’s VA scale, but it’s in a bunch of little pieces scattered all over the United States. I mean, that’s the big part of all of this. The care system is in at least 30 states. I have a map showing where some of the locations are. That map took me months to find. There isn’t a real registry of what the company owns, but it is a vast enterprise. And they’re great assets, if you’ll pardon a financial term for them.

Some of the finest risk-bearing multispecialty group practices in the United States are a part of Optum: Healthcare Partners based in Los Angeles; The Everett Clinic; the former Fallon Clinic, and Atrius in New England, which are the two finest risk-bearing, multispecialty physician groups in the Northeast. They weren’t dredging the bottom here at all. They got a tremendous number of high-quality groups that they’ve pulled together in the organization. The issue is it really an organization or is it a collection of assets that have been acquired at a very rapid pace over a period of the last 15 years.

Rovner: One of the things that I think the Change Healthcare hack proved for a lot of people is that nobody realized what a significant percentage of claims processing could go through one company. You have to wonder, have regulators, either at the state or federal level, kind of fallen down on this and sort of let this happen so that when somebody hacks into it, half the system seems to go down?

Goldsmith: The federal government challenged the Change acquisition and basically lost in court. They were unable to make the case. They were arguing that Change controlling all of these transactions of not only United but a lot of other insurers gave them access to information that enabled United to have some type of unfair competitive advantage. It was a difficult argument to make that didn’t make it. But the result of the Change acquisition was that about a third of the U.S. health system’s money flowed through one company’s leaky pipes.

And what we’re sort of learning as we learn more about Change is that there were something like a hundred separate programs inside Change, all of which somehow were vulnerable to this hack. And I think that’s one of the things that I think when [Sen.] Ron Wyden and [Sen.] Mark Warner get around to getting some facts about this, they’re going to wonder how did that happen. How could you have that many applications, that loosely tied together, that they were vulnerable to something like this?

And what my spies tell me is that a hacker, and it could have been a single hacker, not a country, but one guy was able to drop down into all of those data silos, vacuum out the data, and then delete the backups, so that United was basically left with no claims trail, no provider directories, nothing, and has had to reconstruct them; panicky reconstruction here in the last six weeks.

Rovner: Which I imagine is what’s taking so long for some of these providers to get back online.

Goldsmith: Julie, the part I don’t understand, is if it is true that that Change was processing a trillion and a half dollars worth of claims a year, a month interruption is $125 billion. That’s $125 billion that didn’t get paid to providers of care after the fact of them rendering the care. So the extent of the damage done by this is difficult to comprehend.

I mean, I have a lot of provider contacts and friends. Some of them, believe it or not, had no Change exposure at all because their main payers didn’t use Change. Some of them, it was all their payers used, and cash flow just ceased, and they had to go to the bank and borrow money to make their payrolls. None of this, for some reason, has made it in its full glory out into the press, and it isn’t that there aren’t incredibly high-quality business reporters in this field. There are.

Rovner: I know. I live in Maryland. I’ve driven over the Francis Scott Key Bridge in Baltimore. I know what it means. I mean, basically took apart the Baltimore Beltway. I mean, no longer goes in a circle. And I know how big the Port of Baltimore is, and I feel like everybody can understand that because it’s visceral. You can see it. There’s video of the bridge falling down. There isn’t video of somebody hacking into Change Healthcare and stopping a lot of the health system in its tracks.

Goldsmith: The metaphor that occurred to me, as you know, I’m a metaphor junkie, was actually Deepwater Horizon, and of course, we had a camera on that gushing well the whole time. This is like a gusher of red ink, a Deepwater Horizon-sized gusher of red ink that went on for a month. From what I’m able to understand, people are able to file the claims now. How many people have actually been paid for the month or six weeks’ worth of work they’ve done is elusive. And I still don’t have access to really good facts on how much of what they owed people they’ve actually paid.

I do know a lot of my investor analyst friends are waiting for United’s first-quarter financials to drop, which will probably show a four- or five-day drop in their medical loss ratio because of all the claims they were not able to pay, and therefore money was sitting in their coffers earning, what, 5% interest. That’s going to be kind of a festival when the first-quarter financials drop. And, of course, it isn’t just United, Humana, the Elevance, Cigna, all the rest of them. A lot of these folks use Change to process their claims. So there’s going to be a swollen offer here on the health insurance side from a month of not paying their bills.

Rovner: Well, is it the next Standard Oil? Is it going to have to be taken apart at some point?

Goldsmith: Yeah, but I mean, the question is, on what basis? Our health care system is so vast and fragmented, even a generous interpretation of antitrust laws, you’d have trouble finding a case. The Justice Department or FTC [Federal Trade Commission] is going to try again. But I’ll tell you, I think they’ve got their work cut out for them. I think the real issue isn’t anti-competitiveness, it’s a national security issue. If you have a third of the health systems dollars flowing through one company’s leaky pipes, that’s not an antitrust problem. It’s a national security problem, and I think there are some folks in the U.S. Senate that are righteously pissed about this.

There’s a lot of fact-finding that needs to happen here and a lot of work that needs to be done to make this system more secure. And I’ve also argued to make it simpler. Change was processing 15 billion transactions a year. That’s 44 transactions for every man, woman, and child in the country, and that was only a third of them. What are we doing with 100 billion transactions? What’s up with that? It beggars the imagination to believe that we to minutely manage every single one of those transactions. That is just an astonishing waste of money. It’s also an incredible insult to our care system. The assumption that there at any moment, every one of those folks could potentially be ripping us off, and we can’t have that.

Rovner: So we’re spending all of this money to try and not be ripped off for presumably less money.

Goldsmith: Hundreds of billions of dollars, but who’s counting?

Rovner: It’s kind of a depressing picture of what our health system is becoming, but I feel like it is kind of an apt picture for what our health system has become.

Goldsmith: It’s the level of mistrust. The idea that every one of his patients is trying to get a free lunch, and every doctor is trying to pad his income. We’ve built a system based on those twin assumptions. And when you think about them for a minute, they really are appalling assumptions. Most of what motivated me when I had cancer was fear.

I wasn’t trying to get stuff I wasn’t entitled to or didn’t need. I wanted to figure out a way to not be killed by the thing in my throat. And my doctors were motivated by a fear that if they let me go, maybe my heirs would sue them. I guess this idea that we are just helpless pawns of a behaviorist model of incentives, I think the economists ran wild with this thesis. And I think it’s given us a system that doesn’t work for anybody.

Rovner: Is there a way to fix it?

Goldsmith: I think we ought to cut the number of transactions in half. We ought to go and look at how many prior authorizations are really needed. Is this a model we really want to continue with, effectively universal surveillance of every clinical decision? We ought to be paying in bundles. We ought to pay our primary care physicians monthly for every patient that they see that’s a continuing patient and not chisel them over every single thing they do. We ought to pay for complex care in bundles where a cancer treatment is basically one transaction instead of hundreds.

I think we could get a long way to simplifying and reducing the absurd administrative overburden by doing those things. I also think that the idea that we have 1,100 health insurers. United’s the biggest, but it’s not by any means the only health insurer. There’s 1,100 rule sets that determine what data you need in order to pay a claim and whether a claim is justified or not. I think that’s a crazy level of variation. So I think we need to attack the variation. We’ve had health policy conversations about this for years and not done anything, and I think it’s really time to do it.

Rovner: Maybe this will give some incentive to some people to actually do something. Jeff Goldsmith, thank you so much.

Goldsmith: Julie. It’s good talking to you.

Rovner: OK. We are back, and time for our extra-credit segment. That’s when we each recommend a story we read this week we think you should read, too. As always, don’t worry if you miss it. We will post the links on the podcast page at kffhealthnews.org and in our show notes on your phone or other mobile device. Tami, you’ve already done yours this week. Lauren, why don’t you go next?

Weber: Yeah. I think we’re all keeping an eye on this in this podcast, but the title of this story is “Bird Flu Detected in Dairy Worker Who Had Contact With Infected Cattle in Texas,” which was written by my colleagues, Lena Sun and Rachel Roubein. Also, great pieces by Helen Branswell in the Texas Tribune on this as well.

But, essentially, just so listeners know, there has been a case of human bird flu detected, which is very concerning. As all of us on this podcast know, avian human flu is one of the worst-case scenarios in terms of a pathogen and infectiousness. As of right now, this is only one person. It seems to be isolated. We don’t know. We’ll see how this continues to mutate, but definitely something to keep an eye on for potential threat risk. TBD.

Rovner: Yeah. It is something I think that every health reporter is watching with some concern. Although, as you point out, we really don’t know very much yet. And so far, we have not seen. I think what the experts are watching for is human-to-human transmission, and we haven’t seen that yet.

Kenen: And this person seems to have a mild case, from the limited information we have, which is also a good sign for both that individual and everybody else in terms of spreadability.

Rovner: But we will continue to watch that space. Joanne.

Kenen: Well, you said enough bleak, but I’m afraid this is somewhat bleak. This is a piece by Kate Martin from APM Reports, which is part of American Public Media, and it was published in cooperation with The 19th, and the headline is “Survivors Sidelined: How Illinois’ Sexual Assault Survivor Law Allows Hospitals to Deny Care.” So there’s a very, very strong sort of everybody points to it as great law in Illinois saying that what kind of care hospitals have to provide to sexual assault victims and what kind of testing and counseling and everything. This whole series of services that legally they must do, and they’re not doing it. Even in cases of children being assaulted, they’re sending people 40 miles away, 80 miles away, 40 miles away. They’re not doing rape kits. They’re not connecting them to the counselors, et cetera. It is a pretty horrifying story. It begins with a story of a 4-year-old because they didn’t do what they were supposed to do. The father was the suspected perpetrator, and because the hospital didn’t do what they should have done he still has joint custody of this little girl.

Rovner: My story this week is from our podcast colleague, Alice [Miranda] Ollstein, and her Politico colleague, Megan Messerly, and it’s called “Republicans Are Rushing to Defend IVF. The Anti-Abortion Movement Hopes to Change Their Minds.” And it’s about the fact that while maybe not trying to outlaw IVF entirely, the anti-abortion movement does want to dramatically change how it’s practiced in the U.S.

For example, they would like to decrease the number of embryos that can be created and transplanted, both of which would likely make the already expensive treatment even more expensive still. Anti-abortion activists also would like to ban pre-implantation genetic testing so that, “Defective embryos can’t be discarded.” Except that couples with genes for deadly diseases often turn to IVF exactly because they don’t want to pass those diseases on to their children, and they would like to test them before they are implanted.

In other words, the anti-abortion movement may or may not be coming for contraception, but it definitely is coming for IVF. OK, that is our show. As always, if you enjoy the podcast, you can subscribe wherever you get your podcasts. We’d appreciate it if you left us a review; that helps other people find us, too. Special thanks, as always, to our technical guru, Francis Ying, and our editor Emmarie Huetteman. As always, you can email us your comments or questions. We’re at whatthehealth@kff.org, or you can still find me at X, @jrovner, or @julierovner at Bluesky and @julie.rovner at Threads. Tami, where can we find you?

Luhby: I’m at cnn.com.

Rovner: There you go. Joanne.

Kenen: @JoanneKenen on X, and @joannekenen1 on Threads. 

Rovner: Lauren.

Weber: @LaurenWeberHP on X

Rovner: We will be back in your feed next week. Until then, be healthy.

Credits Francis Ying Audio producer Emmarie Huetteman Editor

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