Medicare Advantage's Financial Reckoning and the High-Cost Reality of TrumpRx
📷 Image source: statnews.com
A Dual Storm in Federal Health Policy
Regulatory Shifts and Market Realities Collide
Two significant developments are reshaping the financial landscape of American healthcare, impacting both government spending and consumer drug costs. According to reporting from statnews.com, dated 2026-02-09T15:50:52+00:00, federal regulators are implementing major changes to the payment model for Medicare Advantage plans. Concurrently, an analysis reveals that the TrumpRx discount drug card, a legacy program from a previous administration, often fails to provide the cheapest available prices for medications.
These parallel stories highlight ongoing tensions between controlling federal healthcare expenditures and delivering tangible savings to patients. The Medicare Advantage changes target the complex system of 'risk scores,' which are used to adjust payments to private health plans based on the projected medical needs of their enrollees. Meanwhile, the TrumpRx findings expose gaps between political promises of affordability and the complex, opaque reality of prescription drug pricing in the United States.
Decoding the Medicare Advantage 'Risk Score' System
How Billions in Federal Payments Are Calculated
Medicare Advantage is a program where private insurance companies administer Medicare benefits. The federal government pays these plans a set monthly amount per member. Crucially, that amount is adjusted using a 'risk score'—a numerical value intended to reflect each enrollee's expected healthcare costs. A higher score, indicating a sicker patient, results in a higher payment to the plan from the Centers for Medicare & Medicaid Services (CMS).
The system is designed to ensure plans are adequately compensated for taking on patients with significant health needs, preventing them from cherry-picking only the healthiest seniors. However, the methodology for calculating these scores has long been a subject of scrutiny and debate. Critics argue the model creates financial incentives for plans to aggressively document diagnoses, potentially inflating scores and leading to overpayments estimated in the tens of billions of dollars annually from federal coffers.
The 'Shuffle': CMS Tightens the Rules
A Technical Change with Major Financial Implications
The change reported by statnews.com involves how CMS accounts for diagnoses collected during a patient's initial enrollment year. Historically, diagnoses from a 'health risk assessment'—a screening often conducted when a patient joins a plan—could be used to boost that member's risk score and, consequently, the plan's payment. The new regulation significantly limits this practice.
Starting with the upcoming payment year, diagnoses from these initial assessments will no longer be counted toward risk scores unless they are confirmed and documented through a subsequent clinical visit. This technical adjustment, while seemingly arcane, is a direct attempt to curb what regulators and watchdogs see as a source of payment inflation. It represents a continued effort by CMS to refine the financial plumbing of Medicare Advantage, which now covers over half of all Medicare beneficiaries.
Industry Reaction and Projected Impact
Plans Brace for Reduced Revenue
The insurance industry has reacted with concern to the announced changes. According to statnews.com, analysts and plan representatives warn that the adjustment will lead to lower risk scores across the board, translating into reduced federal payments. One firm cited in the report projected an effective payment cut of approximately 0.4%, which, on the scale of the Medicare Advantage program, amounts to billions of dollars in foregone revenue for insurers.
Plans argue that the health risk assessments are valuable tools for identifying unmet medical needs early in a member's enrollment, leading to better care coordination. They contend that penalizing the use of this data could disincentivize proactive patient outreach. The financial impact will vary by plan, with those that had relied more heavily on this method of diagnosis coding likely feeling a greater pinch. This sets the stage for potential premium increases or benefit reductions for seniors in the coming years as plans adjust their financial models.
The Persistent Challenge of Risk Score Accuracy
Audits, Oversight, and the 'Coding Intensity' Problem
The risk score change is the latest in a series of actions by CMS to address 'coding intensity.' This term refers to the well-documented phenomenon that Medicare Advantage plans consistently report more diagnoses—and thus higher risk scores—for their patients compared to traditional, government-run Medicare, even when the patients' health status appears similar. The difference suggests systematic upcoding rather than genuinely sicker populations.
To recover suspected overpayments, CMS conducts risk adjustment data validation (RADV) audits. These audits have been a point of legal and political contention, with the agency seeking to extrapolate audit findings from a sample of patients to an entire plan. The industry has fiercely resisted this methodology. The new rule on initial assessments is a prospective, rather than retroactive, attempt to narrow one specific avenue for potential coding inflation before it happens.
TrumpRx: A Discount Card in the Spotlight
Origins and Promises of the Program
Separate from the Medicare policy shift, the statnews.com report examines the ongoing performance of the TrumpRx prescription drug discount card. This program was launched in 2020 as a voluntary initiative for seniors, promoted as a way to deliver 'massive' savings at the pharmacy counter. It operates as a pharmacy discount card, negotiating prices with pharmacy benefit managers (PBMs) and pharmacies to offer reduced rates on medications.
The card was touted as providing transparency and simplicity, allowing users to see discounted prices upfront. However, its effectiveness has been questioned since its inception, with experts noting that such cards are one of many tools in a fragmented and confusing discount market. The program has persisted beyond the administration that created it, remaining available for download and use, which has prompted recent analysis of its real-world value for consumers.
The Price Comparison: TrumpRx vs. Common Alternatives
An Analysis Reveals Disappointing Results
The core finding from statnews.com is that the discounts offered through the TrumpRx card are frequently not the best available deal. Journalists conducted price comparisons for several common medications at multiple pharmacy chains. In many instances, the TrumpRx price was higher than the standard discounted cash price already offered by the pharmacy or available through other widely used discount cards like GoodRx.
For example, the report notes that for a month's supply of the blood thinner Eliquis (5 milligrams), the TrumpRx price was listed at approximately $523 at a major chain. Meanwhile, the same chain's internal cash price was about $20 cheaper, and GoodRx listed a coupon price nearly $70 lower than the TrumpRx offering. This pattern held for other drugs, indicating that the program's negotiated rates often fail to compete in the active marketplace for prescription discounts.
Why Discount Cards Fail to Deliver Consistent Savings
The Complex Mechanics of Drug Pricing
The performance of TrumpRx underscores a fundamental reality of the U.S. prescription drug market: list prices are largely fictional, and actual costs are determined by a web of behind-the-scenes negotiations. Pharmacy discount cards work by accessing pre-negotiated rates between PBMs and pharmacy networks. The rate a card can secure depends entirely on the specific contracts held by its sponsoring organization.
Consequently, no single card is universally the cheapest. Prices can vary dramatically by drug, pharmacy, and geographic location. A card that offers a deep discount on one medication at CVS may provide no savings on a different drug at Walgreens. This creates a burdensome environment for consumers, who must often research multiple options for each prescription—a process sometimes called 'coupon hopping'—to secure the lowest possible out-of-pocket cost.
Broader Implications for Drug Affordability Policy
Beyond Political Symbolism
The analysis of TrumpRx moves beyond evaluating a single program to critique a common political approach to the drug cost crisis. Discount cards are a voluntary, market-based tool that leaves the underlying structure of drug pricing—including manufacturer list prices, PBM rebates, and pharmacy margins—largely untouched. They provide relief for some uninsured or underinsured individuals but do not constitute systemic reform.
Public health experts argue that while such cards can be helpful, they distract from more substantive policy changes that could lower costs for all patients, such as allowing Medicare to negotiate drug prices directly (a power now being implemented), reforming the PBM rebate system, or capping out-of-pocket expenses. The persistence of TrumpRx as a talking point, despite its inconsistent performance, highlights the gap between symbolic political actions and policies that would enact fundamental change in the pharmaceutical market.
International Context: How Other Nations Avoid This Chaos
A Contrast in Pricing Systems
The dual stories of Medicare Advantage financing and discount card futility are uniquely American problems. In most other high-income countries, a single-payer or heavily regulated system negates the need for complex risk score adjustments between competing private insurers. Government entities directly negotiate drug prices nationally, resulting in a single, much lower price for each medication.
The concept of a patient needing a discount card to navigate between competing cash prices at different pharmacies is virtually non-existent in places like Canada, the United Kingdom, or Australia. Their systems prioritize administrative simplicity and equity, though often at the cost of some delays in accessing the very newest drugs. The U.S. system, by contrast, prioritizes choice and rapid innovation but generates immense administrative complexity and wild price disparities that consumers are forced to navigate alone.
The Path Forward: Scrutiny and Systemic Solutions
Where Policy Might Head Next
The Medicare Advantage risk score changes signal that CMS will continue its incremental efforts to perfect the program's payment accuracy. Future battles will likely focus on the methodology for RADV audit extrapolations and potential adjustments to the underlying risk adjustment model itself. The goal is to balance appropriate payment for patient care with the protection of taxpayer dollars from overpayment.
On the drug pricing front, the Inflation Reduction Act's Medicare negotiation provisions represent a more direct systemic intervention than discount cards. However, the continued prevalence of cards like TrumpRx indicates a market response to the remaining gaps for those under 65 or for drugs not yet subject to negotiation. The ultimate solution may lie in greater price transparency and tools that allow real-time comparison of all available discounts at the point of sale, empowering patients in a system designed to confuse them.
Perspektif Pembaca
The complexities of healthcare financing and drug pricing often feel remote, yet they directly impact personal budgets and access to care. We want to hear from you.
What has been your experience navigating prescription drug costs? Have you used discount cards, and if so, what strategies do you employ to find the best price? Do you believe incremental regulatory changes, like those to Medicare Advantage payments, can effectively control costs, or is more fundamental system-wide overhaul required? Share your perspective on the realities of making healthcare affordable.
Alternatively, consider this brief poll: Which aspect of the U.S. healthcare system's complexity frustrates you the most? A) The unpredictable and opaque pricing of prescription drugs. B) The confusing choices and fine print in insurance plans (like Medicare Advantage). C) The sheer amount of personal time and research required to navigate it all.
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