During lunch and after work, the health system called doctors and told them to add more illnesses to the records of patients they hadn't seen in a while. Doctors who find enough new diagnoses could get a bonus or bottles of champagne.
Anthem pays more to doctors who say their patients are sicker. When they couldn't find enough old medical records, executives at UnitedHealth Group told their workers to go back to the drawing board.
The Justice Department described each of the strategies in lawsuits against the companies. Insurers were able to collect more money from the federal government because of the diagnoses.
Congress designed Medicare Advantage to encourage health insurers to find innovative ways to provide better care at a lower cost. By next year, more than 50% of Medicare recipients will be in a private plan.
Most Medicare beneficiaries are expected to be Enrolled by next year.
A New York Times review of dozens of fraud lawsuits, inspector general audits and investigations shows how major health insurers used the program to inflate their profits.
Medicare Advantage insurers are paid a set amount by the government for each enrollee. According to the lawsuits, the insurers have developed elaborate systems to make their patients appear sick, often without providing additional treatment.
A program intended to help lower health care spending has become more expensive than it was supposed to be.
Federal audits show that eight of the 10 biggest Medicare Advantage insurers submitted inflated bills. Four of the five largest players have been accused of overdiagnosing their customers in federal lawsuits.
The Department of Justice is investigating the practices of one of the companies.
Most of the insurers said the federal audits were flawed. They wanted to improve care by accurately describing their patients' health.
Mark Hamelburg is an executive at AHIP, an industry trade group. He said that professionals can look at the same records in different ways.
The Army and Navy spend less on Medicare Advantage than the government does. It is enough money to cover hearing and vision care for every American over the age of 65 according to an estimate from the group that advises Medicare on payment policies.
A former top government health official estimated that the overpayments in 2020 would be double that.
The Medicare Advantage program overbilled.
It's between $12 and $25 billion.
The children's health insurance program.
Customs and border protection in the U.S.
The Bureau of Investigation is a federal agency.
The Environmental Protection Agency is part of the US government.
There is a medicare advantage.
Over billing.
It's between $12 and $25 billion.
The health of children.
There is an insurance program.
Customs in the U.S.
There is border protection.
There is a federal bureau.
There is an investigation.
The environment.
There is a protection agency.
Medicare's finances have been strained by the aging of baby boomers. The Kaiser Family Foundation found that insurers that dominate health care for workers earn twice as much gross profit from their Medicare Advantage plans as from other types of insurance.
There are tradeoffs between traditional Medicare and Medicare Advantage. Patients in Medicare Advantage plans can be limited in their choice of doctors.
Extras like dental benefits draw people to the programs. The more generous the plans are the more money they can afford to spend.
"Medicare Advantage is an important option for America's seniors, but as Medicare Advantage adds more patients and spends billions of dollars of taxpayer money, aggressive oversight is needed." Billions of dollars in improper payments have been made due to the efforts to make patients look sicker.
The whistle-blower law allows former employees to get a percentage of their money back if their suits are successful. If the government believes the fraud allegations have merit it will join most. One of the top areas of fraud recovery was Medicare Advantage.
Micheal Granston is a deputy assistant attorney general for the civil division.
Even as the overpayments have been described in inspector general investigations, academic research, Government Accountability Office studies and numerous news articles, regulators at the C.M.S. have been less aggressive.
Congress gave the agency the power to reduce the insurers' rates, but it has never done so. Four years have passed since the Trump administration proposed a regulation to make the plans to refunds the government for more incorrect payments. There are several top officials who have swapped jobs.
C.M.S. officials didn't want to be interviewed. The administrator of the C.M.S. asked for feedback on how to improve the program. She said that they are committed to making sure that Medicare dollars are used efficiently.
Legislative reforms have been avoided because of the popularity of Medicare Advantage Plans. The plans have become popular in urban areas and have been embraced by both parties. A majority of House members signed a letter saying they were ready to protect the program from policies that would undermine it.
Representative Lloyd Doggett, a Texas Democrat who chairs the House Ways and Means Health subcommittee, said that insurance lobbyists have built strong support for the legislation.
The lack of oversight has encouraged the industry to compete over who can most effectively game the system, rather than who can provide the best care.
Donald Berwick, a C.M.S. administrator under the Obama administration, wrote a series of posts on the industry. Sometimes you will fall in when you skate to the edge.
In Democratic strongholds, the program has grown.
There are a lot of Medicare patientsEnrolled.
There are a lot of Medicare patientsEnrolled.
There are a lot of Medicare patientsEnrolled.
Congress tried to pay insurers the same amount for every patient with the same demographic characteristics.
Patients would cost less and insurers would make more money if the insurers could do better than traditional Medicare.
Insurers like to locate their offices upstairs or offer gym memberships to the healthiest seniors in order to get them to join. The Congress decided to pay more for sick patients.
Companies were able to exploit that system very quickly. The traditional Medicare program didn't give doctors a lot of incentive to document their diagnoses. Insurers began documenting all of a patient's health conditions even if they had nothing to do with the patient's current medical care.
A Florida medical practice was accused of faking diagnoses in order to enrich its owner. When Humana told the doctor who owned the practice that his Medicare risk adjustment scores had increased significantly, he responded by email. The case was over three million dollars.
There was no wrongdoing by the doctor. Humana said it takes compliance seriously. The company told investors that it had been questioned by the Justice Department about its practices.
Insurers were accused of paying doctors more.
Recording additional diagnoses is something that needs to be done.
Insurers were accused of paying doctors more.
Recording additional diagnoses is something that needs to be done.
Digital services were offered to analyze insurers' medical records. The more money the analysis turned up, the more the companies would keep it.
Agencies were hired by the insurers to send doctors to patients' homes to diagnose them with more diseases.
Mobile Medical Examination Services worked with many companies. According to a whistle-blower lawsuit, its doctors and nurses were pushed to document a range of diagnoses, including some that they didn't have the equipment to detect. According to the lawsuit, employees who drew patients' blood often were not provided with a centrifuge or cooler; spoiled blood analyzed a day later produced strange results that could be used to justify important diagnoses. After the case was settled, the company was acquired by Quest Diagnostics.
Anthem: The Justice Department suit quotes an executive describing her reluctance to change how it mined medical records for additional diagnoses. The case is continuing.
The Justice Department joined a whistle-blower lawsuit that claimed that Cigna hired firms to perform at- home assessments that generated billions in extra payments. The firms told nurses to document new diagnoses, treat patients or send them to a doctor.
Some patients were diagnosed with cancer. Even if the patient had undergone surgery to treat the condition, nurses were told to look for patients with a history of diabetes because it was not "curable."
The company didn't say anything. In an earlier statement, the company said it would defend its Medicare Advantage business against the accusations.
Adding the code for a single diagnosis could make a big difference. The government said Anthem instructed programmers to look for revenue-generating codes. According to the lawsuit, one patient was diagnosed with a mental illness, but no one else reported it. There was no evidence of lung cancer in the patient's records, but Anthem was paid an extra $7,080.74 because of it. There is still a case going on.
The companies were accused of not changing potentially invalid diagnoses after becoming aware of them. The Justice Department said that a lot of inaccurate diagnoses were not deleted. The finance executive calculated that eliminating the inaccurate diagnoses would reduce the company's earnings by 72 percent.
Insurers were accused of not removing invalid diagnoses.
Insurers were accused of not removing invalid diagnoses.
Elevance accused the government of holding its Medicare risk adjustment practices to standards that are not grounded in formal statutory and regulatory rules.
Some of the companies took steps to make sure the extra diagnoses weren't costly. In an October 2021 lawsuit, the Justice Department estimated that Kaiser earned $1 billion from additional diagnoses over the course of nine years. The plan was stopped because doctors would have to follow up on too many people.
Insurers were accused of discouraging care for diseases.
Insurers were accused of discouraging care for diseases.
Kaiser is a model system in that it runs a health plan and provides medical care. According to the lawsuit, its control over providers gave it additional leverage to demand additional diagnoses.
The organization was accused of fraud by 10 whistle-blowers, including a former coding expert.
He was told to look for more conditions worth tens of millions of dollars. How could we get this on the agenda?
A spokesman for Kaiser said in a statement, "We are confident in our compliance with Medicare Advantage risk-adjustment program requirements."
A company that collected 40 percent of Medicare Advantage payments from chart reviews and home assessments despite serving only 22 percent of the program's beneficiaries was noted by the inspector general's office last year. Medicare should pay more attention to the company, which it did not name, but the number of people who signed up was similar to UnitedHealth's.
Next year is when a civil trial will be held against UnitedHealth. According to the lawsuit, the company's internal audits found a lot of errors. Drug and alcohol dependence is three times more likely to be diagnosed by a doctor than the national rate. The suit says that UnitedHealth didn't investigate those patterns.
UnitedHealth Group: A whistle-blower complaint quotes an executive’s email to a firm that was helping the company review patient medical records. A trial is scheduled for next year.
Matthew Wiggin said the inspector general's report was "misleading". He said that the company uses diagnostic coding to improve patient care and that the whistle-blower in the lawsuit had not worked for the company in a decade. He said that the chart review process complies with regulatory standards.
The company argued that it wasn't required to fix inaccurate records before the regulations changed. It lost on appeal. The case was not heard by the Supreme Court.
The number of profitable diagnoses was increasing before the first lawsuits were filed. Overcharging has not been stopped by Medicare.
Several experts, including Medicare's advisory commission, recommend that the plans' payments be reduced. Congress gave C.M.S. the power to make more cuts if they continued to over bill. That power has not been used by the agency.
The agency audits insurers when they look at a few hundred of their customers. Insurers are fined if there are mistakes in patients. A rule that was proposed during the Trump administration is not finalized.
Some of the agency's top leaders have industry connections. The main trade group for health insurers was run by Andy Slavitt, who was previously an executive at UnitedHealth. After leaving the agency, Jonathan worked for an insurer before returning to Medicare as the agency's chief operating officer.
Ted Doolittle was a senior official for the Center for Program Integrity at the time. He said that there was some resistance coming from inside. Feet were dragging.
The problem is not going away.
The Office of Inspector General has analyzed Medicare Advantage overbilling and has heard about it more and more.
Kaiser Permanente: An executive discussed punishing doctors who failed to review patient records for more diseases, according to a Justice Department lawsuit. The case is continuing.
Twelve of the 21 cases have been brought or joined by the Justice Department. The department has to evaluate whistle-blower cases before they are made public. Mary Inman is a partner at Constantine Cannon, which represents many of the whistle-blowers.
Major legislative or regulatory changes to the program are not expected.
According to Richard Gilfillan, a former hospital and insurance executive, Medicare Advantage overpayments are a political third rail. The big health care plans are making too much money to stop fixing it. The C.E.O.s should come to the table with Medicare as they did for theAffordable Care Act, stop the coding frenzy, and let providers focus on better care.
Graphics were contributed byAlicia Parlapiano
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