Healthcare's "Hotel California"

When Americans turn 65, they face one of the most consequential healthcare decisions of their lives: whether to enroll in traditional Medicare, the government-run program, or Medicare Advantage (MA), a privately administered alternative funded by taxpayer dollars and operated by insurers like Humana, United Healthcare, and Aetna.

When those seniors who chose an MA plan get older or need additional services, they find that the advantages offered by MA plans do not offset the advantages of traditional Medicare which offers nationwide access, stable coverage, minimal prior authorization, and federally governed appeals protections. As a result, they often want to switch to traditional Medicare.

But this is where the rug gets pulled out from under them. Seniors often find out that they can become effectively trapped in Medicare Advantage. While it is easy to move from traditional Medicare into MA, trying to switch to traditional Medicare often means being denied affordable Medigap supplemental coverage or facing unaffordable premiums due to medical underwriting. This one-way door gives insurance companies leverage and leaves seniors vulnerable just when their healthcare needs increase.

How can we fix this?

Wouldn’t it be amazing if a patient struggling to find care due to their MA plans restrictions was simply advised by a friend or their physicians’ office that they could simply switch to traditional Medicare and avoid all of the games the private insurers play? Well, here’s the playbook.

Action 1: Guarantee the Right to Switch Back

Seniors should be able to move from Medicare Advantage to Traditional Medicare at any time, with guaranteed access to Medigap coverage—no underwriting, no health-based premium increases, no denials or delays. There is already precedent for this. Four states—New York, Maine, Massachusetts, and Connecticut—already provide this protection.

This is not a call to eliminate Medicare Advantage. It is a call to restore balance, competition and patient choice.

Impact: True competition would return to Medicare. MA plans would be forced to improve care, reduce denials, and stabilize networks—or lose members. Administrative burdens would fall and both providers and patients would regain leverage because they would have choices. Taxpayers will benefit, as multiple studies have shown MA beneficiaries cost taxpayers roughly 20% more than those in traditional Medicare.

Of my four action items, this first one is the key.

Action 2: End Confusing and Misleading Plan Names

Privately run plans should not use the word “Medicare” in their product names. Medicare Advantage should be renamed to reflect what it is: private insurance for seniors.

Insurers should also be prohibited from licensing trusted third-party names such as AARP (hello UnitedHealth Group!) that obscure who actually controls coverage. Plan names should clearly identify the parent insurance company rather than hide behind a trusted entity.

Impact: Clearer naming would reduce confusion, improve informed decision-making, and prevent misleading claims that Medicare Advantage reforms are “cuts to Medicare.”

Action 3: Properly Align Executive Compensation 

If more than 25% of an insurance executive’s compensation comes from company stock or capital gains, that compensation should be taxed as normal income, not capital gains.

Medicare Advantage is funded by taxpayers. Executives should not be incentivized to boost stock prices through denials, network cuts, or stock buybacks instead of improving care or lowering costs.

Impact: Aligning incentives with patient outcomes—not share price—might discourage profit-maximizing behavior that harms seniors.

Action 4: Enforce Full Price Transparency

Insurers should no longer be allowed to hide behind “proprietary information” to obscure costs charged to the government and beneficiaries. If taxpayer dollars fund the program, the government must have full visibility into pricing, cost structures, and profit margins. Plans that refuse transparency should not be allowed to participate in the program.

Impact: Transparency would enable accountability, better pricing oversight, and more responsible use of public funds.

Medicare Advantage did not exist until 2003, when Congress passed the Medicare Modernization Act. The goal was straightforward: introduce private-sector competition to improve efficiency, lower costs, and enhance care for seniors. The assumption—common across many industries—was that private markets would outperform government administration.

More than twenty years later, the results are clear. Medicare Advantage has failed to deliver on that promise. Instead of lowering costs, MA now costs taxpayers billions more each year than Traditional Medicare. What began as a competitive alternative has evolved into a system dominated by a handful of massive, publicly traded insurers that increasingly prioritize financial performance over patient care.

Former Congressman Jim Greenwood, who helped create Medicare Advantage, recently acknowledged that the program has “become something quite different” from what Congress envisioned—no longer a driver of efficiency, but a system in which large insurers “game the rules for profit,” extracting billions from a program meant to serve seniors.

Today’s Medicare Advantage program is marked by limited transparency, heavy administrative burdens on physicians, unstable provider networks, and restrictive coverage rules. Numerous investigations have documented practices that shift costs onto patients and providers while increasing government spending. As a result, many patients, doctors, and hospitals now prefer Traditional Medicare over the privately-run Medicare Advantage program.

Why Seniors Choose Medicare Advantage

Lower premiums are the biggest draw. For relatively healthy seniors, especially those focused on short-term costs, Medicare Advantage can make financial sense. Over several years, the savings can be substantial. MA plans also offer extras like dental, vision, and hearing benefits—services not included in Traditional Medicare. But these benefits come with strings attached. Provider networks can change annually. Many services require prior authorization from the insurer shifting care decisions from doctors to insurance administrators. These differences often become most apparent later in life—after a serious illness, accident, or decline in health—when seniors need care the most. At that point, many beneficiaries want to switch back to Traditional Medicare, only to find out it is not that simple.

Bottom Line

Medicare Advantage should compete based on value, not on barriers to exit. Guaranteeing Medigap access for seniors who choose to return to Traditional Medicare is a targeted, practical reform that protects beneficiaries, restores competition, and saves taxpayer money—while preserving choice within Medicare. Americans pay into Medicare over their entire working lives. Congress must ensure that the system serves seniors—not corporate shareholders.

Chuck Melendi is a healthcare executive with 35 years of domestic and international leadership experience. A 25-year veteran of Johnson & Johnson, he led drug price negotiations with payers, advanced health policy and reform efforts, and held senior sales and marketing roles. He is the founder of Disruptive Dialogue, where he works to inform consumers and drive meaningful change in the U.S. healthcare system.