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Audits Reveal Costly Medicare Advantage Overcharges
Approximately three dozen Medicare plans overcharged the government for a large majority of treated patients by exaggerating the severity of their medical conditions, including diabetes and depression, according to audits obtained by the Center for Public Integrity.
According to the 37 Medicare Advantage plan audits from Federal health officials, acquired through a Freedom of Information Act lawsuit, some plans had overpayments dating back to 2007, although money has since been paid back. Medicare Advantage is a privately-run option to standard Medicare which has been growing in popularity and now enrolls over 17 million seniors.
Medicare paid the health plans more than $160 billion in 2014. According to the Centers for Medicare and Medicaid Services (CMS) audits, all but two of the 37 health plans audited for 2007 were overpaid several hundred thousand dollars too much for the sample of 201 patients examined at each plan.
Among the plans cited for overcharging the government, five were from Humana Inc, three from UnitedHealth Care Group plans, and four from Wellpoint, Inc.
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Auditors on average could only confirm 60 percent of approximately 20,000 medical conditions treated. Overpayments triggered by unsupported medical diagnoses at the 37 plans audited topped $10,000 per patient for more than 150 patients. Auditors revealed that he health plans overall were three times as likely to charge Medicare too much than too little for some of the 70 medical conditions examined.
Reportedly, diabetes without medical complications was the most commonly reported by the health plans, and auditors typically validated the payments in three of four cases.
Regardless of the size of the overpayment, none of the plans faced closer scrutiny following the audits. The 2007 audits, totaling $12 million in overpayments, are the only ones CMS has completed since officials adopted risk scores in 2004. Health plans are still appealing the results, nine years later.
CMS claims that overcharges are more common than undercharges because health plans have an “incentive to submit diagnosis codes to CMS and, as a result, are less likely to under-report these diagnoses.” ---Julie Gould
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