UnitedHealth Sued by U.S. Government Over Medicare Charges
Written by Editor   
Monday, March 06, 2017 01:34 PM

News bite:  It seems that “insurance fraud” does NOT extend ONLY to health providers.  The US Government is suing UnitedHealth and others for inflating its plan members’ risk scores since at least 2006 in order to boost payments under Medicare Advantage's risk adjustment program.

The U.S. Justice Department has joined a whistleblower lawsuit against UnitedHealth Group Inc that claims the country’s largest health insurer and its units and affiliates overcharged Medicare hundreds of millions of dollars. The lawsuit, filed in 2011 and unsealed last month alleges UnitedHealth Group overcharged Medicare by claiming the federal health insurance program’s members nationwide were sicker than they were.  The Justice Department has also joined in allegations against WellMed Medical Management Inc, a Texas-based healthcare company UnitedHealth bought in 2011.

UnitedHealth spokesman Matthew Burns said  “we reject these more than five-year-old claims and will contest them vigorously.”

The lawsuit by whistleblower Benjamin Poehling, a former UnitedHealth executive, has been kept under seal in federal court in Los Angeles while the Justice Department investigated the claims for the past five years.

The lawsuit alleges that Minnetonka, Minn.-based UnitedHealth has inflated its plan members’ risk scores since at least 2006 in order to boost payments under Medicare Advantage's risk adjustment program.

UnitedHealth, the nation's largest Medicare Advantage insurer, allegedly collected payments from false claims that it treated patients for conditions they didn't have, for more severe conditions than they had, conditions that had already been treated, or diagnoses that didn't meet the requirements for risk adjustment, according to the complaint.

The lawsuit claims that in 2010, UnitedHealth planned to increase operating income by $100 million through "Project 7," which was the company's codeword for initiatives to increase risk adjustment payments. 

Payment rates in Medicare Advantage are based on regional trends and utilization in traditional fee-for-service Medicare as well as adjustments to plan members' risk scores, among other variables. Under the Medicare Advantage program, the government pays private health plans monthly amounts for every member they cover, and those taxpayer-funded payments are adjusted based on how sick someone is.

Members with more chronic conditions have higher risk scores, and plans that cover them receive higher payments. These risk scores were created to incentivize plans to cover all seniors regardless of their health status, but there have been several whistleblower lawsuits in recent years that allege foul play by health plans to inflate the scores and collect more funds.

On average, the CMS pays a Medicare Advantage plan close to $3,000 per year, per condition that a member has that requires a risk adjustment payment, according to the complaint.

Source:  http://www.medscape.com/viewarticle/875956