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Kaiser Health News sues CMS for Medicare Advantage audits

Written by Diane Archer

On September 26, Kaiser Health News brought a Freedom of Information Act suit (FOIA) against the Centers for Medicare & Medicaid Services (CMS) in order to secure 90 Medicare Advantage audits showing hundreds of millions of dollars in overcharges.

The government audits have never been subject to public scrutiny. However, we do know the health plans that have been charged with bilking the government. Aetna, Humana, UnitedHealth and Wellpoint are all implicated, among others.

Kaiser’s editor-in-chief, Elisabeth Rosenthal, believes that the public should see the details of these overpayments. The companies implicated are serving people with Medicare. It’s due time they be held to account and stopped from overbilling the federal government.

Kaiser requested the audit information directly from the Centers for Medicare and Medicaid Services on July 3, 2019. CMS did not respond to the request. Kaiser argues in its lawsuit that CMS’ failure to respond to its request represents a violation of FOIA. It seeks immediate release of the documents.

Inexplicably, CMS is treating Medicare Advantage plans in a different way from other medical businesses. CMS publicly discloses audits of other medical businesses.

Federal government audits reveal that Medicare Advantage plans are overcharging the federal government–taxpayers–some $10 billion a year and have been overcharging the government for many years. Medicare Advantage plans claim their members are in worse health than they actually are in order to receive higher payments from the government. They have not presented evidence to justify their claims.

For years, Medicare Advantage plans have been required by law to turn over data showing the services their members are receiving. And, for years, audits have found the limited data they release to be incomplete and inaccurate. Last month, Senator Sherrod Brown and five of his Senate colleagues wrote CMS expressing their concern about Medicare Advantage overpayments and other activities in violation of their contractual obligations.

The amount of Medicare Advantage overcharges is likely far higher than we know. Federal audits only capture a fraction of the billings. The federal government has wanted to extrapolate the billing error rate across the universe of Medicare Advantage plan members. But, the commercial insurers that offer Medicare Advantage plans are opposing this, claiming it would be unfair to them.

Of course, the more money that CMS claws back from the Medicare Advantage plans, the less money the Medicare Advantage plans have to profit at the level they have been profiting. So, they are also threatening to leave Medicare.

In 2014, the Center for Public Integrity won a lawsuit against CMS forcing it to release audits of Medicare Advantage plans. In that instance, the information released showed that CMS overpaid virtually all the Medicare Advantage plans, in 150 instances by as much as $10,000 a patient a year.

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