Dr. Oz Loves Medicare Advantage, Providers Hate It. What Could Oz's CMS Takeover Mean for the Future?

One way or another, Medicare Advantage is in for a change in 2025.

November has been a busy month as President-elect Donald Trump began rolling out his cabinet picks. From Dr. Mehmet Oz taking over CMS to RFK Jr. spearheading HHS, there has been no shortage of reactions to the newly appointed. 

While all important, the most recent nomination of Dr. Mehmet Oz as the next Administrator of CMS has ignited healthcare leadership discussions about one topic in particular: the future of Medicare Advantage (MA). 

Dr. Oz’s history of media prominence and his evolving views on healthcare policy may foreshadow significant changes for MA, a program long under scrutiny by hospitals and health systems for its poor reimbursement practices and administrative hurdles.

HealthLeaders knows well the strife MA causes for hospital and health system leaders, so digging into what Dr. Oz could mean for the future of the program is warranted.

Medicare Advantage: A system forever under fire?

As we know, MA plans, operated by private insurers under CMS oversight, offer an alternative to traditional Medicare. 

While beneficiaries often enjoy lower premiums, additional benefits like vision and dental care, and out-of-pocket cost caps, providers have voiced strong concerns about the program's operational challenges.

One case in point is Scripps Health. Two medical groups within the system canceled their MA contracts for 2024 because of low reimbursement rates, denials, and administrative costs to manage high utilization and out of network care.

These challenges have led to annual losses that exceeded $75 million for the system.

“We’re unfortunately on the vanguard of what I think is going to be a very ugly few years between hospitals and commercial insurance companies,” Chris Van Gorder, president and CEO of Scripps, told USA Today.

And Scripps has the resources to better manage these burdens, meaning these burdens are even more exacerbated for smaller systems.

An example of this is Samaritan Health Services. It recently terminated its commercial and MA contracts with UnitedHealthcare.

The five-hospital, nonprofit health system cited slow processing of requests and claims that have made it difficult to provide appropriate care to UnitedHealth's members, according to a news release from Samaritan.

“This, along with other factors, is not in alignment with our mission of building healthier communities together,” the health system said.

Another example is St. Charles Health System, a four-hospital network and healthcare company in Central Oregon, which terminated its MA contracts in 2023.

Steve Gordon, president and CEO of St. Charles, said great thought went into the decision to reevaluate MA participation, and it was done only after years of concerns piled up not just at St. Charles, but at health systems throughout the country.

“The reality of Medicare Advantage in central Oregon is that it just hasn’t lived up to the promise,” he said in a press release. “A program intended to promote seamless and higher quality care has instead become a fragmented patchwork of administrative delays, denials, and frustrations. The sicker you are, the more hurdles you and your care teams face. Our insurance partners need to do better, especially when nurses, physicians and other caregivers are reporting high levels of burnout and job dissatisfaction.”

These issues have led some healthcare leaders to question the sustainability of MA in its current form, even as enrollment continues to climb.

Oz’s stance on Medicare Advantage

While Dr. Oz has yet to explicitly outline his policy priorities as CMS Administrator, his past commentary provides clues about his approach. 

In 2020, he co-authored an op-ed with George Halvorson, former CEO of Kaiser Permanente, in Forbes proposing a vision for “Medicare Advantage for All.”

The proposal sought to extend MA beyond older adults to include all Americans not already enrolled in Medicaid. They suggested rebranding the program as “Medical Advantage” and funding it through a 20% payroll tax.

In the article, Dr. Oz and Halvorson argued that this system would eliminate Medicare fraud as a government expense and significantly reduce administrative burdens. The duo also emphasized that consolidating the U.S. payment system under MA would simplify healthcare delivery, reducing administrative costs by a third.

“Once instituted, the universal Medicare Advantage plans should be obligated to reduce excess administrative costs by a third,” they wrote.

As a Pennsylvanian, I was front and center when Dr. Oz revisited these ideas during his Senate campaign in 2022, branding the proposal as “Medicare Advantage Plus.” A campaign spokesperson described the plan as expanding access to “high-quality, low-cost” healthcare, which “is beloved by seniors and should be available to everyone who wants it.”

As a physician and public figure, Dr. Oz has extolled the virtues of prevention and patient-centric care, themes consistent with MA’s emphasis on managing chronic conditions and promoting wellness. 

However, his association with controversial health products and practices raises questions about whether his leadership would align with the evidence-based reforms many stakeholders hope to see in MA.

Should hospitals and health systems brace for impact?

Hospital and health system leaders are likely to approach Oz’s nomination with caution, given the stakes for their financial stability. 

Excessive administrative burdens, driven largely by MA policies, have led to soaring operational costs. A study published in Health Affairs found that hospitals spend billions annually on administrative tasks related to MA disputes, highlighting the need for systemic reform.

Oz’s appointment represents a marked departure from the technocratic leadership of the Biden administration. Current CMS Administrator Chiquita Brooks-LaSure, a policy expert with a focus on equity and access, has championed measures to address MA plan denials and streamline processes for providers. 

For example, under Brooks-LaSure, CMS finalized new rules aimed at reducing “prior authorization” burdens—a frequent source of friction between insurers and providers.

Dr. Oz’s background, by contrast, suggests a more consumer-oriented approach, potentially at the expense of provider-centric reforms. This shift could exacerbate tensions with hospitals and health systems unless Oz works to balance patient access with provider sustainability.

Key questions moving forward

So, all that being said, there are several critical questions that will shape MA under Oz’s leadership:

• Will reimbursement rates improve? Providers hope for policies that narrow the gap between MA and traditional Medicare payments.
• Can prior authorization reform advance? Hospitals will closely watch for signs that CMS will tackle administrative inefficiencies.
• How will enrollment growth be managed? As more beneficiaries choose MA, ensuring adequate funding and oversight will become increasingly urgent.

Dr. Mehmet Oz’s nomination to lead CMS has injected uncertainty into the future of MA. For hospital and health system leaders, his tenure could either herald long-awaited reforms to address reimbursement and administrative challenges—or deepen existing frustrations with the program.

While his tenure remains an open question, one thing is clear: the future of MA will remain a critical issue for America’s healthcare system.