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NYT: Medicare Advantage rife with fraud

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Report from New York Times says most large insurers in the program have been accused of fraud

A report from The New York Times on Medicare Advantage says that most of the large insurers in the program have been accused of fraud.

Insurers are accused of making patients appear sicker than they actually were to boost pay by looking for old illnesses in medical records and paying bonuses to doctors to add illnesses to patients they hadn’t seen in weeks.

Medicare Advantage is a private sector alternative to traditional Medicare and more than half of Medicare patients will be in the program by next year.

According to the Times report, eight of the 10 largest Medicare Advantage insurers have submitted inflated bills. Four of the five largest players—UnitedHealth, Humana, Elevance, and Kaiser—face federal lawsuits alleging that efforts to overdiagnose their patients crossed the line into fraud. The fifth company, Aetna, told investors its practices were also being investigated by the Department of Justice.

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AHIP, the industry trade group for the insurance companies, said the accusations reflect missing documentation rather than fraud, and the Times reported that insurers dispute the federal allegations and were aiming to improve care by documenting more conditions to accurately reflect a patient’s health.

The Times report also pointed out that Medicare Advantage plans typically earn twice as much gross profit than other types of insurance.

According to The Times, the most common allegation is that the insurers did not correct potentially invalid diagnoses after becoming aware of them. At Anthem, for example, the Justice Department said “thousands” of inaccurate diagnoses were not deleted. According to the lawsuit, a finance executive calculated that eliminating the inaccurate diagnoses would reduce the company’s 2017 earnings from reviewing medical charts by $86 million, or 72 percent. The company said that the government is holding it to standards not grounded in statuatory and regulatory rules.


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