In a new study by the Common Wealth Fund, it was found that moving seniors to private Medicare HMO’s are costing taxpayers 5.2 billion dollars per year. The study found that coverage through a Medicare HMO usually costs 12.4 percent more than normal fee-for-service Medicare plan.

Advocate of the program say that it increases the role of the private sector in Medicare and gives beneficiaries more choices and greater efficiency, while those against it argue that the free-to-market ideology has forced Congress to endorse a program that costs much more and gives seniors more restricted care.

The research showed that the average beneficiary only uses 800 dollars of services and the new plan costs much more. The report compared the cost of the two approaches in 3000 US counties. It found that managed care costs around 922 dollars more per year than the traditional system used by the federal government.

Multiply the cost of the managed healthcare system by the 5.6 million Medicare beneficiaries, and it equals out to 30 billion dollars wasted on Medicare over the next five years. Money that could be used fill in many other holes in our healthcare system, such as the doughnut hole in Medicare Part D.

Besides costing more, the plan also limits the type of care seniors can receive and where they can receive it at. The old Medicare plan would allow seniors to switch between plans, or change back to the original Medicare plan if seniors experienced any difficulties, such as their local hospital switching to another plan.

Robert Hayes, president of the Medicare Rights Center, a non-profit group that provides assistance to Medicare beneficiaries said, “It’s very unfortunate few of these plans offer any value,” Hayes said. “There should be a level playing field between traditional Medicare and Medicare Advantage. The new Congress should immediately pull money back for providing real care for people with Medicare.”