President Donald Trump has frequently lambasted health insurance companies for “making a killing,” but a series of recent policy decisions since his return to the White House has instead funneled billions of dollars to the industry, according to a report by STAT and federal records.
Despite public attacks characterizing insurers as “fat cats” that need to be reined in, the administration’s latest actions have consistently bolstered corporate bottom lines.
The most significant of these was the finalization of higher benchmark payment rates for Medicare Advantage plans in 2027, a move expected to direct an additional $13 billion to the private insurance industry.
This decision accompanied the administration’s choice to abandon a key reform that would have updated the “risk adjustment” formula—the mechanism used to pay insurers based on the health of their members. Government staff had previously argued that the new model would have more accurately reflected current treatment patterns and coding practices.
Following the announcement, stock prices for major Medicare Advantage insurers, including UnitedHealth Group and Humana, surged. Analysts from investment bank Jefferies noted that the new rates could push earnings growth for these companies “solidly above” long-term projections. UnitedHealth and Humana currently combine to cover nearly half of the Medicare Advantage market.
According to STAT, “almost every major decision Trump officials have made since reclaiming the White House has benefitted insurers and their bottom lines.”
Beyond Medicare Advantage, the administration has moved to deregulate Affordable Care Act (ACA) marketplaces by allowing for “skimpier” coverage and repealing rules that require insurers to offer standardized plan options.
The policy shift comes despite promises from Mehmet Oz, Trump’s head of the Centers for Medicare and Medicaid Services (CMS), to be the “new sheriff in town” and target “upcoding” and system gaming by privatized plans. However, a review of lobbying letters reveals that the largest insurers specifically pressured the administration to withdraw the risk adjustment revisions that Oz had pledged to address.
CMS officials defended the recent rate hikes and reform delays as necessary for “near-term stability” to allow the market “time to breathe.” Critics, however, argue the decisions are “literally politics,” noting that the administration provided no credible, fact-based justification for shelving reforms that would have led to lower, more accurate payments.
Further industry-friendly actions include a finalized change to star ratings measures, which is projected to route an extra $18.6 billion to insurers over the next decade.
While the administration claims to prioritize beneficiaries, the current trajectory suggests that the fat cats the president targeted in his rhetoric remain some of his administration’s primary financial beneficiaries.
Those looking to avoid the world of profiteering health insurance companies may wish to look at health sharing ministries, where instead of insurance, Christians pool their resources to cover health costs.