Beware of Starship Captains Who Bear Gift Cards

You already know the ads. They appear each fall, a sign of the season as familiar as apple cider donuts and the changing of the leaves.

A former quarterback or an actor from a venerable TV show looks straight in the camera and says, warmly: you may be entitled to benefits you aren’t getting today: dental, vision, a card for groceries, a ride to your doctor. Seniors at home just have to call the number on the screen to sign up for a Medicare Advantage plan today. Operators are standing by.

They certainly are, but their primary aim isn’t to find the best plan for their caller’s needs. It’s to get them to sign up for the plan that’s most profitable for them.

Superior plans that are less lucrative for the salespeople on the other end of the line will go unmentioned.

Politicians in Washington have argued for decades about whether Medicare costs too much. But that’s the wrong question. There isn’t just one Medicare. There are thousands of plan options, and seniors who choose the wrong plans incur tens of billions of dollars of deadweight loss every year. The only beneficiaries are insurance companies and their unscrupulous agents.

The financial cost to taxpayers is just one of many negative consequences. Mismatches in coverage exact a very real human cost. Doctors who a retiree has seen for decades are suddenly out of network. Procedures are denied. Retirement is transformed from a land of milk and honey into The Hunger Games.

Some important data to consider:

Page 9 of the Senate Aging Report reveals that over 4 million Americans will become eligible for Medicare next year, in 2027.

An estimated $100 billion per year is wasted, as calculated by the following:

Wrong Part D plan selection: $20–46 billion/year. GoodRx research finds the average Medicare beneficiary overspends $840/year by not being in the optimal Part D plan. A University of Pittsburgh/Health Affairs study found only 5.2% of beneficiaries chose the most cost-effective Part D plan – with average overspending of $368/year. With ~55M Part D enrollees across MA-PDs and PDPs, even the conservative $368 figure implies $20 billion+ in annual Part D waste.

Wrong Medigap plan selection: ~$10B/year. Medigap plans are required by law to offer identical coverage: a Humana Plan G in a given area is indistinguishable from an Aetna Plan G. But they do not cost the same; the cost spread is a result of brokers only presenting a subset of plan options.

Wrong Medicare Advantage plan selection: likely >$20 billion/year. This is more difficult to estimate precisely since MA plans are not standardized and a comparison would have to factor in out-of-pocket spend in addition to premiums and there is no published data on the former. Internal data based on switching members to better coverage suggests this exceeds $20 billion/year.

Medicare Advantage overpayments to insurers: $76–84 billion/year. MedPAC and the Joint Economic Committee estimate Medicare Advantage insurers collected $84 billion in excess payments in 2025 and $76 billion in 2026 above what Traditional Medicare would have cost for the same beneficiaries – driven by diagnostic upcoding and risk score manipulation. A Senate investigation confirmed that these are not theoretical losses; they flow directly to insurer profits. The complexity of plan options makes this difficult to identify.

Prior authorization-driven care delays and downstream costs: unknown but massive. MA insurers made 53 million prior authorization requests in 2024, denying 4.1 million. HHS found 13% of those denials were inappropriate – in other words, care that should have been covered under standard Medicare rules. The AMA found prior authorization denials trigger cascading costs: 69% of physicians report patients end up with ineffective initial treatments, 68% require additional office visits, and 42% land in the ER. These downstream costs are not tallied in the overpayment figures above.

Some mistakes can be corrected…but other decisions are irreversible. For example: all seniors are initially eligible for Medigap plans, which offer the greatest flexibility and broadest access, but if you are talked into a seemingly cheaper Medicare Advantage plan you may be unable to switch down the road when your health inevitably deteriorates and you need that coverage most. All because you were hoodwinked into signing up for a lousy plan that made a broker a quick buck.

A financial advisor giving guidance on your 401(k) is bound by law to put your interests ahead of their own. They have a fiduciary responsibility to recommend what is right for you. Medicare brokers have no such obligation. It is perfectly legal for them to push plans that they know to be inferior on their fellow citizens.

All Americans ought to find this intolerable.

Cobi Blumenfeld-Gantz, CEO and co-founder of Chapter, a Medicare navigation platform, put it best in his testimony before the Senate Finance Committee: “The current Medicare brokerage model is broken because it does not require brokers and other stakeholders to put consumers first. There are no legal requirements that mandate prioritizing consumer interests. The lack of such requirements and related lack of consumer awareness is a significant problem facing consumers navigating and enrolling in Medicare options. Brokers should be held to a higher standard of conduct and accountability.”

Blumenfeld-Gantz suggests that companies should review every possible Medicare plan permutation and blind its advisors to commissions to ensure unbiased guidance. But this requires technical talent to offer full plan permutations, and the unbiased approach requires investors who are aligned on long-term strategy: it involves leaving money on the table in the near term with the hope that building goodwill with consumers will pay off in the long run. 

Commission-incentive-based companies and their lobbies have made it very difficult for unique companies like Chapter to continue to exist. In fact, it is the only survivor (out of 10+ companies) holding the line in the now corporatism-driven space. It remains the exception when it ought to be the rule.

As conservatives, we believe in markets. We are skeptical of government regulation that often does more harm than good. We value choice and competition. But Medicare is a government program into which we all pay over the course of our working lives. It is an entitlement to which its recipients are genuinely entitled.

And a free market requires accurate information. A world in which the information on Medicare.gov is confusing and inaccurate, and seniors are forced to rely on brokers with perverse – in fact directly inverse – incentives, is not a world we should accept.

There has been much chatter in recent years over “common-good conservatism.” Well, this is as strong a case as any for using the power of the state to protect the welfare of our elders without compromising conservative principles. And all while saving taxpayer dollars that are wasted today.

So the next time you see one of those scammy Medicare ads that run each fall, don’t just raise your deflector shield and go on with your life. Write to your elected officials and demand that brokers present all options to the seniors that they serve and abide by (at least) the same fiduciary standard as if they were recommending financial investments.

That is the only way that all Americans over 65 will finally be able to live long and prosper.

Especially since there will be roughly 72 million people in this category in one year’s time.