"...Overpayments are used to improve insurance industry profits and are not completely passed along to beneficiaries. When Congress approved the system which overpays private plans, policymakers intended that the excess payments be returned to beneficiaries in the form of additional benefits or reduced cost-sharing. It is not at all clear to what extent this is occurring. Private plans are subject to few public reporting requirements, so it has been extremely difficult to determine what percentage of the overpayments has padded the profit margins of the private insurance companies offering the plans, or has been used for marketing, rather than being returned to beneficiaries. In the case of Private Fee-For-Service plans, MedPAC found that only about half of the excess payment is used to deliver extra benefits for enrollees. The remainder of the payment is used to finance the administrative costs, marketing, and profits of private plans..."