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Justice Department sues Anthem for Medicare Advantage fraud

Written by Diane Archer

Bob Herman reports for Axios that the Department of Justice is suing Anthem for fraud. The lawsuit, filed by the US Attorney’s Office for the Southern District of New York, claims that Anthem intentionally charged the government more for its members in Medicare Advantage plans than it should have in violation of the False Claims Act. We’ve heard this story before.

Anthem is not the only health insurance company offering Medicare Advantage plans that the DOJ has sued for fraud. Many Medicare Advantage plans have been charged with wrongly overcharging the government to the tune of tens of billions of dollars. The government has not been able to recoup this money.

The overpayments happen when health insurers claim that their members are in worse health than they actually are. The health insurers are supposed to make sure that their members have the health conditions they claim they have before billing the government higher rates for them. They also are required to pay the government back for any overcharges, which they practically never do.

It costs the federal government a lot of time and a lot of money to try to recoup the overpayments. And, the health insurers fight back. Billions in government overpayments mean both higher costs to taxpayers and higher premiums for people with Medicare.

Like the other health insurance companies offering Medicare Advantage plans, Anthem says that its practices are defensible. It also claims that CMS is engaged in a double standard when it tries to recoup money from Medicare Advantage plans based on payment standards it “does not apply to original Medicare.”

Most people with Medicare–about 36 million– are enrolled in traditional Medicare. With traditional Medicare, they can see virtually any doctor and use any hospital in the US, without a referral or prior authorization. They are protected from unexpected costs so long as they have supplemental coverage–Medigap, retiree coverage or Medicaid. But, the upfront costs can be higher than traditional Medicare for people who need to buy supplemental coverage to pick up the deductibles and coinsurance costs.

The ranks of people in Medicare Advantage are growing. These plans tend to have few if any upfront costs. The problem is that when you get sick, there are many barriers to care, including narrow networks, limits on where your care is covered, prior authorization requirements and copays. Out-of-pocket costs for in-network care alone can be as high as $6,700 a year.

Here’s more from Just Care:


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