Moran Advances Bipartisan Legislation to Bring Transparency to Medicare Advantage Spending Out of Committee

Congressman Nathaniel Moran (TX-01) released the following statement after the bipartisan Medicare Advantage MLR Transparency Act was passed 42-0 out of the Ways and Means Committee. The legislation requires Medicare Advantage (MA) organizations to publicly disclose how much of their revenue goes toward patient care versus overhead.

"Transparency and accountability must be at the center of reforming our healthcare system," said Rep. Moran. "President Trump has made price transparency a cornerstone of his healthcare agenda, and this bill seeks to double down on that effort by pulling back the veil legislatively and requiring more information be made public about how Medicare Advantage dollars are spent. We are giving patients and taxpayers the clear, comparable information they need to hold these plans accountable, and make sure that they are actually going toward direct patient care."

This bill codifies President Trump's Great Healthcare Plan to hold insurance companies accountable and maximize price transparency:

• Injects transparency and accountability into MA spending by requiring MA plans to submit to CMS and publicly post on their website more detailed revenue and spending information.

• Requires CMS to align the standards of benefit information across all insurance types in the Medicare and commercial markets.

"Medicare Advantage now serves more than half of all Medicare beneficiaries, but seniors and taxpayers still lack important information about how these plans receive and spend tax dollars," said Ways and Means Committee Chairman Jason Smith (MO-08)."Transparency is essential to ensuring patients can make informed decisions about their health care and taxpayers can have confidence that their dollars are being used responsibly. Representative Moran's Medicare Advantage MLR Transparency Act advances President Trump's Great Healthcare Plan by bringing greater accountability to Medicare Advantage finances and benefit information. I appreciate Representative Moran's leadership in ensuring East Texas seniors and taxpayers have the information they deserve."

Background:

The Medical Loss Ratio (MLR) was established by the Affordable Care Act in 2010 to regulate revenue and administrative costs for certain insurance companies, including Medicare Advantage (MA) plans. Under the MLR standard, most large insurers must spend at least 85% of revenue on direct medical care or quality initiatives, leaving no more than 15% for administrative overhead, compliance, policy implementation, and corporate profit.

There have been concerns that MLR reporting currently is difficult and confusing for the public to understand due to the multiple MA revenue spending streams-including benchmark payments, risk adjustment payments, Quality Bonus Program payments, and premiums-and count both clinical services covered by Medicare and supplemental benefits, such as dental, vision, hearing, or fitness, as direct medical care.

As a result, the MLR has proven ineffective at providing potential and current beneficiaries insight into how their premium dollars are and will be used.

Read the full legislation here.

Watch Rep. Moran's full remarks here.

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