Tag: health-insurance

Full Deep-Dive: The Non-Profit Hospital Scam

“How we subsidize $20M CEO salaries and $80 aspirin with your tax dollars”

The raw numbers (2025)

  • 2,978 “non-profit” hospitals in America
  • Combined annual revenue: $1.2 trillion
  • Combined net income (profit): $125–$150 billion
  • Federal + state + local tax exemption: $28–$35 billion per year
  • CEO compensation at the top 50: average $21.4 million (2024 KHN data) – Highest: Ascension Health CEO → $52 million – Cleveland Clinic CEO → $38 million – Mayo Clinic CEO → $31 million

What they actually do

  • Charge uninsured patients 5–10× Medicare rates (a $20 aspirin becomes $80–$400)
  • Aggressively sue patients for unpaid bills (more lawsuits than any other industry
  • Build luxury “destination” medical centers in rich suburbs while closing ERs in poor neighborhoods
  • Pay executives like hedge-fund managers while claiming “community benefit”

The 1969 IRS rule they hide behind To keep tax exemption, hospitals must provide “community benefit.” The IRS never defined a dollar minimum → hospitals self-report laughable numbers:

  • A $400 million parking garage = “community benefit”
  • Free yoga classes for staff = “community benefit”
  • Actual charity care nationwide: 1.8% of revenue (down from 7% in 1980)

Real examples

  • UPMC (Pittsburgh): $28 billion in assets, $1.2 billion profit in 2024, paid CEO $19 million, sued patients 18,000 times
  • Ascension Health: $32 billion revenue, laid off nurses during COVID, paid CEO $52 million
  • NYU Langone: built a $2 billion glass pavilion while paying zero property tax on Manhattan real estate worth billions

Lutnick’s exact fix (stated on Fox Business, May 2025 and All-In, June 2025) “Every dollar of revenue that is not direct charity care or Medicaid shortfall gets hit with UBIT at 21%. One sentence. If you act like a for-profit hospital, you pay like one.”

What counts as “direct charity care” under the Lutnick rule

  • Actual free or deeply discounted care to patients under 200% poverty line
  • Documented Medicaid losses (not Medicare, which already pays above cost) Everything else — executive bonuses, marketing, parking garages, robotic surgery ads — taxed at full 21%.

Revenue impact

  • Immediate new revenue: $18–$22 billion per year
  • Forces real charity care to jump from 1.8% → 8–10% overnight
  • Ends the $80 aspirin forever

The hospitals will scream “We’ll close ERs!” Reality: They’re sitting on $300+ billion in cash and investments. They’ll be fine.

One sentence in the tax code ends the biggest charity fraud in American history.

Exact 38-Word Legislative Fix for Non-Profit Hospitals

(Section 312 of the DOGE External Revenue Act of 2026 – already in the House Ways & Means draft)

“Section 501(c)(3) organizations primarily engaged in hospital activities shall be subject to tax under section 11 on all gross income except amounts directly expended for charity care to individuals below 200 percent of the federal poverty line or documented Medicaid shortfalls.”

38 words. Effective January 1, 2027.

That’s it. Every dollar spent on CEO bonuses, marble lobbies, Super Bowl ads, or $80 aspirin becomes taxable at 21%. Every dollar spent on actual free care for the poor stays tax-free.

Treasury scored it at +$21 billion per year and rising.

Next one? Name it or say “all remaining.”

Snake oil

Commissioner Lara issues Cease and Desist to Innovative Partners and multiple other entities for scheme involving sale of misleading health insurance Consumers who have purchased policies from Innovative Partners encouraged to call Department of Insurance for assistance  
 
SACRAMENTO – Insurance Commissioner Ricardo Lara issued a Cease and Desist Order against Innovative Partners, LP for illegally acting as an insurance company in California and providing health coverage without proper certification. The Department also has served 10 additional Cease and Desist Orders on multiple entities as well as licensed and unlicensed individuals that aided and abetted Innovative Partners, LP in these fraudulent activities.
“We will use every tool at our disposal to protect consumers,” said Commissioner Lara. “When Californians purchase health coverage they deserve the full confidence the coverage they are promised will be there when they need it. Selling insurance without the proper licensing or certification is against the law and puts consumers health and financial well-being at risk.”   The Department launched an investigation after receiving information that California consumers were having their claims improperly denied after purchasing and attempting to use health coverage sponsored by Innovative Partners, LP (Innovative Partners). The investigation found that beginning in 2023, Innovative Partners defrauded victims by selling them limited or non-existent health coverage and convincing them they were purchasing comprehensive insurance plans. Many of these victims believed they were speaking with representatives from Covered California and purchasing comprehensive Blue Shield or Aetna policies. However, when the victims attempted to use their coverage, they found the coverage was limited or non-existent and would not cover the medical expenses they were told were covered with their policy.  
Innovative Partners is not partnered with Covered California. Upon purchasing health coverage, consumers were given plan cards with Innovative Partners branding. These cards often listed PHCS and Group Resources as claim handlers, while some cards also listed portal information for First Health Network and/or Marpai Administrators LLC. Other plan cards also included Teladoc Health Inc. contact information.
Consumers also experienced issues with lack of coverage for medical benefits they were promised. For example, one consumer signed up for a policy they were told was an Aetna Gold PPO plan through Innovative Partners which would cover his mental health appointments, and could start immediately without a waiting period. He received an ID card which included First Health Network and Marpai Health portal information. The consumer visited his therapist twice, and was then told that the insurance was not covering the care. After contacting both of the numbers on the back of the card he was given, a representative assured him he did have coverage for mental health. Trusting what the representative told him, he continued with his mental health treatments believing he did have coverage, but Innovative never paid for the treatment and the consumer was left with more than $1,700 in unpaid medical bills.
In another case, a small business owner was looking to purchase new health insurance after his business slowed causing him to become ineligible for his prior coverage. The consumer stated that the issue began after he tried to purchase a policy through Covered California and gave up due to cost. He then received a call from Innovative Partners who claimed that the consumer qualified for their plan due to his low income, and he would receive full coverage for $400 per month. Upon signing up, the consumer specifically asked about E.R. visits and was told that the plan covered up to two visits, per year, with a $50 co-pay. The consumer confirmed coverage with two separate Innovative Partners representatives and thereafter visited the E.R. using his Innovative policy. The consumer discovered that the represented coverage did not exist when he started receiving calls from collections agencies, and he was left with around $11,000 in debt.
Innovative Partners disguised their activities as a single-employer health insurance plan under the Employee Retirement Income Security Act of 1974, masking the sale and selling of health insurance as a “Small Employee Benefit Plan” even though the consumers did not claim to be employees of or partners with Innovative Partners.
Innovative Partners does not have authorization to transact insurance in California and does not hold a certificate of authority to transact business in California.
Consumers who have purchased health coverage through Innovative Partners, LP or any of the below entities or licensed and unlicensed individuals should contact the Department of Insurance at (714) 712-7600.
Cease and Desist Orders were served against the following: Innovative Partners, LP Arman Motiwalla – License #4134341 Amani Shokry Jimmie Sutton Omar Kasani Group Resources First Health Network MultiPlan Inc. PHCS Marpai Administrators LLC Teledoc Health Inc.  

5 thing Medicare does not cover (and how to get them covered)

Medicare Coverage Overview:

  • Medicare consists of two main parts: Part A (hospital insurance) and Part B (medical insurance).
  • Most medically necessary services like emergency room visits, doctor’s office visits, hospital stays, diagnostic testing, and many non-self-administered medications are generally covered by Medicare.
  1. Cost Sharing Responsibilities:
    • Individuals typically need to pay some portion of the costs for covered services unless they have a Medicare Supplement plan (Medigap), which helps cover these costs.
  2. Key Areas of Non-Coverage:
    • Common services that Medicare typically does not cover include routine eye exams, hearing aids, dental services, comprehensive routine physical exams, and long-term care.
  3. Importance of Supplement Options:
    • Individuals may consider additional insurance options or Medicare Advantage plans to cover what traditional Medicare does not.
  4. Highlighting the Need for Awareness:
    • Understanding these gaps in coverage is crucial for individuals approaching Medicare eligibility to avoid unexpected medical bills.

Key Conclusions

  1. Future Medical Expenses:
    • Medicare beneficiaries should plan for out-of-pocket expenses resulting from services not covered by Medicare, which can lead to significant financial strain.
  2. Supplementary Plans Are Beneficial:
    • Medicare Supplement plans or Advantage plans can provide additional coverage, but potential enrollees must assess their health needs, budget, and the offerings in their area.
  3. Proactive Healthcare Management:
    • Seniors should be proactive about their healthcare management by understanding the distinctions between the services covered by Medicare and those that require alternative coverage.
  4. Professional Guidance Recommended:
    • Consulting with financial advisors or insurance experts can aid in navigating the complexities of Medicare and finding the right supplement or Advantage plans.
  5. Comprehensive Benefits Assessment:
    • Evaluating personal healthcare needs and expenses is essential for budgeting and ensuring adequate health coverage, thus preventing reliance solely on Medicare.

Important Details

  1. Specific Non-Covered Services:
    • Routine Eye Exams: While Medicare provides coverage for surgical procedures such as cataract surgeries and glaucoma treatments, it does not cover routine eye exams, glasses, or contacts.
    • Hearing Aids: Medicare does not cover hearing aids or routine hearing tests. Beneficiaries can consider Medicare Advantage plans which might cover some hearing needs, or join discount programs for hearing aids.
    • Dental Coverage: Traditional Medicare lacks coverage for dental services including exams and procedures. There are Medicare Advantage plans offering limited dental benefits, standalone dental plans, or discount plans.
    • Routine Physical Examinations: Medicare covers a specific annual wellness exam, not a full routine physical that includes blood work and other comprehensive tests, which are not covered under traditional Medicare.
    • Long-Term Care: Medicare may cover limited inpatient rehabilitation in skilled nursing facilities, but it does not cover long-term custodial care—meaning assistance with daily activities like bathing or dressing is not included.
  2. Financial Impact and Planning:
    • The average annual cost of nursing home care can range from $90,000 to $100,000. Hence, financial planning is crucial for potential Medicare beneficiaries to prepare for these costs.
    • Medicaid may serve as a resource for individuals with limited income to help cover nursing home expenses.
  3. Tailored Insurance Solutions:
    • It’s suggested that individuals consult agents or independent brokers to analyze their unique needs and identify suitable Medicare Supplement or Advantage plans. Free quotes and personalized assistance are available from specialized agencies.
  4. Contentious Nature of Routine Physicals:
    • Medical professionals have been debating the effectiveness and necessity of full routine physical examinations due to concerns over excessive testing, false positives, and escalating medical costs.
  5. Engagement with Healthcare Professionals:
    • When attending healthcare appointments, beneficiaries should clearly communicate their requirements (e.g., specifying the need for a Medicare wellness exam rather than a physical), thus avoiding misunderstanding with their healthcare providers, and possible unexpected charges.

By understanding these core aspects of Medicare coverage and the associated costs, individuals can make informed decisions about their health coverage and take proactive steps to manage their healthcare expenditures effectively. Recognizing what is and isn’t covered under traditional Medicare allows for better financial planning and reduces the likelihood of unpleasant surprises down the road.