Episode
The $83 Billion Scam Hidden Inside Medicare (And the Economist Who Proved It)
- Published
- Jun 9, 2026
- Duration seconds
- 3512
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Summary
What if the system designed to protect your health in retirement was actually engineered (from the inside) to profit from keeping you confused, underserved, and locked out of the care you've already paid for? You've spent decades paying into Medicare. You've done everything right. And yet, as you approach the years when healthcare matters most, the system greeting you on the other side is riddled with hidden traps, gaming, and a funding crisis that Washington refuses to look at directly. In this episode, Professor Kotlikoff talks with his Boston University colleague Dr. Randy Ellis, one of the world's foremost health economists and the architect of the very risk-adjustment formula that determines how much the government pays your Medicare Advantage plan. He literally built it. And he's saying it's being exploited in ways that are costing taxpayers $83 billion a year, with your care hanging in the balance. Time Stamped Learnings: [8:27] Why Medicare Advantage plans are paid billions more than they should be, and how insurance companies game the diagnostic coding system to pocket the difference [9:00] The "cherry-picking" crisis nobody in Washington wants to admit: how private health plans are specifically designed to attract healthy enrollees and quietly push sick ones back into traditional Medicare [10:24] Why the formula running your Medicare payments is 30 years old (built in the 1990s, implemented in 2002, and barely updated since) while insurance companies have decades of new data and technology to exploit every loophole [23:00] What Europe is doing right, and why countries like the Netherlands, Germany, and Belgium are delivering better health outcomes at nearly half the cost per GDP [41:14] The age-65 cliff that's trapping older Americans in jobs they d…