Tag: Fraud

Humana settles Medicare prescription drug fraud lawsuit
We continue to hear about inappropriate and sometimes fraudulent behavior on the part of insurance companies offering Medicare benefits. Yet, rarely, do these companies get caught, prosecuted and penalized. Recently, Humana settled a whistleblower lawsuit brought under the False Claims Act, alleging Humana overcharged the federal government, reports Rebecca Pifer for Healthcare Dive.

It’s hard to believe that this whistleblower accusation reflects a one-off fraudulent act by a Medicare insurer. More likely, it indicates that abuses are happening. If you want to get a sense of the scope of health insurer abuses, check out violationtracker.org, which shows that UnitedHealthcare alone has paid more than $2 billion in penalties since 2000. But, it’s costly and resource-intensive to fight the health insurers, so they can get away with a lot.

In this case, Humana is paying a $90 million settlement. You have to wonder whether the activities in which it engaged generated profits far larger than this penalty.

Insurers provide prescription drug benefits under Medicare Part D to more than 54 million people with Medicare. The Part D benefit has improved so that, in 2025, people with Medicare will spend no more than $2,000 out of pocket on their medications. But, the Part D insurers can still steer them to more costly medications, away from generic drugs and, in some cases, charge them more in copays than the full cost of their drugs if they went to Costco.
Part D insurers are obligated contractually to cover a range of drugs. Still, they are able to get around the requirements and maximize their revenues at the expense of their enrollees. In the Humana suit, the whistleblower claimed that, over a six-year period ending in 2017, Humana reported that its Part D coverage costs were higher than they actually were, overcharged the government, and provided hundreds of millions of dollars less coverage to its enrollees than legally required.

To undertake the fraud, the whistleblower explained that Humana kept two sets of books. Yes, that’s right, the two-sets-of-books scam does not only happen in the movies! For unknown reasons, the Department of Justice did not intervene in the suit.

A Humana spokesperson sent an email to Healthcare Dive claiming that “Humana firmly believes that the actuarial assumptions in its prescription drug plan were reasonable and in full compliance with all laws and regulatory requirements, and that the plaintiff’s claims in the case are without merit.”

The majority of False Claims Act judgements and settlements last year were in the health care industry. They are happening at record levels. Meanwhile, policymakers claim concern about growing Medicare fraud. You’d think this would be a signal to Congress that the government should take the insurers out of the Medicare program and guarantee everyone government-administered health care. It’s not.

Here’s more from Just Care:
August 27, 2024
Wall Street Journal exposes how insurers game Medicare Advantage, costing taxpayers nearly $600 billion
Christopher Weaver and others report for The Wall Street Journal on how Medicare Advantage insurers game the payment system. They reap tens of billions of additional dollars each year through false claims that their enrollees have health conditions that they do not really have. The Medicare Advantage payment system is defective, cheating taxpayers. What will it take for Republicans and Democrats in Congress to eliminate these overpayments and reform the payment system in Medicare Advantage?

The Medicare Advantage plans hire nurses to visit enrollees and identify additional health conditions for them. They even give $50 gift cards to enrollees who allow these nurses to visit them at home. With new diagnosis codes on patient records, Medicare pays Medicare Advantage insurers billions of additional dollars, driving up Part B premiums for everyone with Medicare and ripping off taxpayers.

UnitedHealth is one of the insurers that engages nurses to visit their enrollees at home. In some cases, nurses find “diabetic cataracts” which leads to as much $2,700 in additional Medicare payments for a single enrollee in a year. But, sometimes, if not more often than that, the enrollee has neither diabetes nor cataracts, the Wall Street Journal found in an analysis of Medicare records.

Dr. Howard Chen, an ophthalmologist in Arizona, said he had one or two patients each year with diabetic cataracts. But, UnitedHealth reported to Medicare that 148 of his patients had this condition. Compared to patients in Traditional Medicare, UnitedHealth enrollees were 15 times more likely to have diabetic cataracts. When told about this odd disparity, eye experts said that it was not plausible that so many UnitedHealth enrollees could have this condition.

The Wall Street Journal also found that insurers who add additional diagnoses to patient records often do not provide care to patients with these diagnoses. Even when the additional diagnoses were for deadly conditions that would require treatment, such as AIDS, the insurer provided no follow-up care.

UnitedHealth reported $8.7 billion for diseases they never treated, such as HIV in 2021. UnitedHealth also kept a Hepatitis C diagnosis on records of more than half of their patients who had completed treatment for the condition and had been cured.

The WSJ findings add to a chorus of findings from an array of independent experts, revealing the defective Medicare Advantage payment system. Taxpayers have spent more than half a trillion dollars—$591 billion— on Medicare than they would have spent had Medicare Advantage never been enacted, according to the Medicare Payment Advisory Commission. This privatized Medicare Advantage program has been a bust from a cost perspective.

What’s worse is that Medicare Advantage plans too often deny care inappropriately to enrollees who need costly care. And, still worse, the government has little ability to oversee the insurers offering Medicare Advantage, let alone punish the criminal insurers in a meaningful way. The Centers for Medicare and Medicaid Services, which oversees Medicare, is hard-pressed to cancel their contracts.

UnitedHealth disputed the WSJ findings saying they were “inaccurate and biased.” But, it provided no evidence to support its claim. In contrast, the WSJ found 66,000 patients diagnosed with diabetic cataracts, when it was not possible. They had had cataract surgery and could not have had cataracts!

Here’s more from Just Care:
July 10, 2024
Beware of criminals stealing Social Security benefits
Many older adults and people with disabilities rely on Social Security as their sole source of income in retirement. Typically, Social Security deposits their monthly benefit directly into their bank accounts. But, Tara Seigel Bernard reports for the New York Times that last year 2,000 people found themselves the victims of criminals who diverted that money into their own bank accounts.

The criminals change the bank account to which Social Security benefits are directed. And Social Security staff say that this is a common crime. Between 2013 and 2018, 21,000 people lost $33.5 million in Social Security benefits to criminals. The government was able to stop $23.9 million in attempted fraud during that same time. Between 2019 and 2023, 7,600 people let the Federal Trade Commission know that criminals had redirected their Social Security benefits.

Don’t ever give anyone your Social Security number. Social Security will never ask for it. But, criminals call claiming to work at Social Security or a computer company, a bank, an insurance company, a credit bureau or a doctor’s office and persuade people to divulge personal information the criminals can use to steal their Social Security benefits. Criminals then break into people’s online Social Security accounts and change all applicable information so that the benefits go to their bank accounts.

Criminals are also claiming benefits of people who have reached retirement age but have not yet claimed benefits.

The Office of the Inspector General suggests that the online Social Security portal is not secure enough. People can verify their identity too easily. Social Security claims to be doing what it can, updating its systems, but the Office of the Inspector General says it needs to do more.

Social Security does write people when there is a change to their account to ensure they authorized it. And, that has helped avoid a lot of fraud.

Consider identifying someone you trust serve as your representative payee with Social Security. You might not need a representative payee now, but should you be unable to manage your Social Security account on your own, it’s good to have a representative payee in place. A power of attorney will not work with Social Security. You will need a representative payee.

You can lock your Social Security account. Put an e-services block on your Social Security account. You will not be able to change any information you provided Social Security online, but neither will anyone else. If you do need to change something, you will need to reach out to your local Social Security office to do so.

You can put a direct deposit block on your account to prevent fraud. Again, this will keep anyone, including you, from changing your direct deposit information online. If you do need to change something, you will need to reach out to your local Social Security office to do so.

Never trust that a caller is from Social Security even if Social Security appears on your phone’s caller ID. If the caller presents some issue with your accountant, hang up and call Social Security directly at 1-800-772-1213.

If you are scammed: Call the Federal Trade Commission at 1-877-IDTHEFT (1-877-438-4338) or contact them online here.

Here’s more from Just Care:
March 13, 2024
Medicare fraud: Traditional Medicare v. Medicare Advantage
What makes news is often confounding. Report after report comes out revealing as much as $140 billion in overpayments each year to insurers offering Medicare Advantage plans, eating into the Medicare Trust Fund and driving up Medicare premiums. Still, the New York Times focuses on $2 billion in fraudulent claims for catheters in Traditional Medicare without placing it in the context of a projected $1.56 billion in waste and fraud in Medicare Advantage through 2033. Of course, $2 billion isn’t chump change, and catheter fraud is a new and perhaps more colorful story.

No question there’s Medicare fraud. The only question is how and when it is detected and addressed. It seems that when the Centers for Medicare and Medicaid Services (CMS), which oversees Medicare, is dealing with relatively small durable medical equipment companies in Traditional Medicare, it is better able to address a fraud than when it is dealing with gigantic health insurers in Medicare Advantage. In other words, watch out for bad actors in Medicare Advantage that could keep you from getting critical care because the government isn’t watching out for you.

What’s particularly striking about the catheter story is that it does not focus on the Medicare carrier that processes Medicare claims. How could the Medicare carrier possibly have paid out $12,000 for 2,000 urinary catheters to one Medicare enrollee? Why wasn’t there a red flag in its computer system?

The catheter story also doesn’t highlight that the reason we know about this fraud is that the data is accessible for analysis, unlike Medicare Advantage data, which tends to be incomplete, inaccurate, if available at all, and untimely.

What happened in the case of the catheter fraud? Seven suppliers of these catheters billed the Medicare accounts of 450,000 people enrolled in Traditional Medicare $2 billion for urinary catheters in 2022-2023. Not one of these 450,000 people received these catheters. It turns out that six of the seven companies did not have a working phone number.

What is CMS doing about these fraudulent bills? Curiously, it has the ability to withhold payments to companies suspected of fraud until it determines whether the bills are legitimate or not. Of note, CMS is either unable to use this authority with insurers offering Medicare Advantage plans when they are suspected of fraud or unwilling to.

Here’s more from Just Care:
February 13, 2024
Choose your hospice provider carefully
Hospice care has grown in popularity for people with terminal conditions who seek comfort care rather than curative treatment. But, now, more than ever, you need to choose your hospice provider carefully. Ava Kofman continues to write for Pro Publica on how profiteers have taken over hospice in the US, at huge financial cost to the Medicare program and huge risk to patients at the end of life.

As a result in significant part of Kofman’s earlier reporting, described in this Just Care post, the Centers for Medicare and Medicaid Services (CMS) conducted more hospice inspections. But, CMS continues to certify new hospices, even in California, where the state has banned new hospice licenses because of mounting hospice fraud.

It appears that CMS does not have the ability or desire to close down hospices engaging in fraud. After visits to 7,000 hospices, CMS stopped just 46 of them from billing the government for their services. The travesty: The 46 hospices were nonoperational.

CMS claims that it’s up to the states to stop the proliferation of hospices. CMS appears to be unwilling or unable to prevent even fraudulent or unneeded hospices from receiving certifications to deliver the hospice benefit to people with Medicare.

Arizona, California, Nevada and Texas have seen a huge spike in the number of its hospice providers. CMS showed marginal concern at best about fraudulent bills from these hospices and the lack of need for additional hospices in these states. CMS said it would look at their bills more closely.

California attempted to put a moratorium on new hospices in its state, with little success. Its auditors detected “a large-scale, targeted effort to defraud Medicare.” Hospice providers charged Medicare for patients who were not terminally ill and sometimes for patients who were fictitious.

Notwithstanding California’s good oversight, CMS is allowing these hospice providers to bill Medicare for their “services.” CMS claims to need “evidence of sanctions” against a hospice in order to block a hospice from the Medicare program.

In California, people enrolled in hospice fraudulently—people who are not terminally ill or who do not want hospice—are reportedly at risk of not getting needed care. Medicare covers hospice services only for patients who agree not to receive curative care for their conditions. That said, they should be able to get care for any condition unrelated to a terminal condition. Moreover, they are also always able to opt out of hospice to get curative care.

In one case, a nursing home resident with dementia was fraudulently enrolled in hospice by a doctor she did not know. Medicare paid the hospice $7,500. But, the patient lost her ability to have her pacemaker checked and to receive physical therapy. CMS is now investigating.

Here’s more from Just Care:
January 30, 2024
Justice Department goes after one Medicare Advantage executive
Last week, the Justice Department announced it was prosecuting a former executive of HealthSun Health Plans, an insurer offering Medicare Advantage plans in Florida, for engaging in millions of dollars in fraud. There’s no small irony in the fact that our federal government is going after a bit player in the Medicare Advantage fraud world and not prosecuting or cancelling its contract with HealthSun, much less prosecuting and cancelling contracts with the large corporate health insurers that are engaged in billions of dollars of fraud.

HealthSun’s “prompt voluntary self-disclosure, cooperation, and remediation, as well as HealthSun’s agreement to repay the Department of Health and Human Services’ Centers for Medicare & Medicaid Services (CMS) approximately $53 million in overpayments” clears it of criminal liability, according to the Justice Department. Pretty nice gig. Keep the money when you’re not caught, return it and be absolved of criminal penalty if you are caught.

The Justice Department alleges that Kenia Valle Boza, 39, of Miami, who headed Medicare Risk Adjustment Analytics at HealthSun, arranged for submission of false and fraudulent information to CMS in order to generate greater income for HealthSun. Lots of HealthSun employees were involved. It’s hard to believe members of HealthSun’s C-suite were unaware. Those executives certainly benefited.

The big problem: The Medicare payment system to insurers offering Medicare Advantage plans is defective. It pays insurers more when they enter more diagnosis codes in patient records and trusts insurers to enter diagnosis codes that are accurate. So, the insurers do what they can to enter as many codes as possible on each enrollee’s medical record. The more codes, the more income to the insurers.

So long as there is a viable case that the codes are accurate, the insurers benefit. And, if the codes are inaccurate, the insurers benefit so long as the government doesn’t perform an audit. Indeed, even when the federal government identifies overcharges in audits, it rarely recoups the overpayments. It’s a great deal for the insurers and the reason they are all chomping at the bit to increase their Medicare books of business.

In the case of HealthSun, Boza and others are charged with fabricating tens of thousands of diagnosis codes and entering them in patient records to generate millions of dollars of overpayments. Let’s hope this is the beginning of a much larger Justice Department crackdown on Medicare Advantage fraud; people with Medicare need protection from the insurance company Medicare Advantage bad actors that they currently are not getting.

Surprisingly and sadly, based on the CMS enforcement actions web page, CMS has not taken a single enforcement action against a Medicare Advantage plan this year, even though several government agencies and independent analysts have reported widespread bad acts by some Medicare Advantage plans.

Here’s more from Just Care:
October 31, 2023
Fraudsters banned from the Medicare program circumvent the ban
How does the federal government stop repeated Medicare fraud and abuse you might ask? Too often it does not. Sarah Jane Tribble reports for Kaiser Health News on Congressman Lloyd Doggett’s attempt to address this issue in Traditional Medicare.

After a Kaiser Health News investigation exposed how the Medicare and Medicaid systems were broken and not able to prevent repeat health fraud, Congressman Doggett introduced a bill to keep the fraudsters from continuing to bill Medicare.

The problem: The federal government has the authority to ban Medicare providers from the program for fraudulent or illegal behavior. But, these providers can circumvent the ban very easily in many cases. Why? The government relies on these fraudsters to be honest when reporting their criminal histories whenever they apply to offer Medicare or Medicaid services.

The government does not confiscate the national provider identifiers of fraudsters. The Centers for Medicare and Medicaid Services, which oversees Medicare and Medicaid, cannot take away people’s national provider identifiers, even when the government has banned them from these programs. The federal government has no authority to ban these providers from delivering services outside of Medicare and Medicaid, and the providers use these identifiers for those services as well.
The Doggett solution: HR 1745 would deactivate the national provider identifiers for people convicted of waste, fraud and abuse if their names are among the 1600 or so on an exclusions list kept by the HHS Office of the Inspector General.

Congressman Doggett believes his bill should be bipartisan, since Republicans say they want to eliminate waste and fraud. So far, Republicans have not commented on the bill. A Kaiser Health News analysis found that a couple of dozen people on the OIG exclusions list were violating their exclusions.

Here’s more from Just Care:

Coronavirus: Watch out for Medicare fraud

Inspector General finds Medicare telehealth fraud

Dental fraud: How to protect yourself

Corporate health insurers profit by condoning fraud

Medicare Advantage: Combating fraud is a challenge because there’s no data on denied claims
May 2, 2023
Medicare Advantage: Combating fraud is a challenge because there’s no data on denied claims
Medicare Advantage plans are required to submit complete and accurate data on the services their enrollees receive–patient “encounter data”–but, according to the Medicare Payment Advisory Commission, they have never done so. To the extent Medicare Advantage plans submit data, the Office of the Inspector General (OIG) reports that they fail to disclose when they deny payment for services their enrollees receive. Consequently, OIG can’t oversee them adequately and combat fraud.

Th OIG finds that without the Medicare Advantage information concerning specifics about the services for which they are denying payment, the OIG cannot effectively understand, identify and address waste, fraud and abuse. As we know, in some significant fraction of instances, hospitals and other providers deliver services to MA enrollees for which the Medicare Advantage plans do not pay. When Medicare Advantage plans don’t pay for the services their enrollees receive, they threaten the viability of hospitals, particularly rural hospitals and hospitals serving low-income populations.

The OIG said that detailed encounter data, showing which claims are denied, is critical to fighting fraud and abuse. It allows the OIG to identify billing patterns that are suspect. The Centers for Medicare and Medicaid Services (CMS), which oversees Medicare, inexplicably does not require that information of the Medicare Advantage plans, even though CMS requires that information in traditional Medicare and for Medicaid health plans.

CMS simply requires that Medicare Advantage plans submit “claim adjustment reason codes” when they do not pay the amount a provider bills. Adjustment codes do not reflect with certainty whether a claim was denied. For example, a code might indicate: “The procedure or service is inconsistent with the patient’s history.” In these cases, sometimes the Medicare Advantage plan reports it paid, even though it would seem it had not.

Of note, in 2019 most MA encounter data contained at least 1 adjustment code, including 55 million that suggest the MA plan did not pay for the service.

If OIG and others knew which Medicare Advantage claims were denied, they could check for fraud and understand the full scope of fraud in a Medicare Advantage plan. However, CMS’s group that focuses on Medicare Advantage payments sees requiring this data as a burden on the Medicare Advantage plans.

The OIG explains why it does not see this requirement as a burden. First, the insurers offering Medicare Advantage plans enter information about denied claims for their Medicaid enrollees, so could easily do so for their Medicare enrollees. Second, it would make it easier for the Medicare Advantage plans to comply with OIG requests for information on denied claims. Third, if CMS moves to a system of using encounter data to determine Medicare Advantage costs and payments, as it has said it plans to do, CMS will need this information.

The OIG’s final recommendation is that CMS require the Medicare Advantage plans to show on their encounter data whether they paid the claim or not. Curiously, CMS took no position, even though OIG says it would enhance its ability to oversee Medicare Advantage and fight fraud.

Here’s more from Just Care:
March 6, 2023
Medicare Annual Open Enrollment: Beware of Bad Actors
Medicare Annual Open Enrollment begins on October 15 and runs through December 7. You have many choices to make and you should take the time needed to make them, for both your physical and your financial health. A smart choice could save you money and steer you away from bad actors.

Five things to keep in mind:
- Many insurers offering Medicare Advantage have long histories of fraud, which can endanger enrollees’ health and well-being. They profit more if they cover less care.
- Choose a Medicare plan that covers care from high quality doctors and hospitals, including cancer centers of excellence.
- Referrals and prior authorizations pose barriers to care in Medicare Advantage.
- Out-of-pocket costs in Medicare Advantage pose barriers to care.
- If you opt for Medicare Advantage, you might lock yourself out of Traditional Medicare because federal law does not guarantee you the right to buy supplemental coverage.
Access to care: Health insurance is about your care needs today and unforeseeable needs down the road. Your Medicare plan should cover all medically necessary care if you’re diagnosed with cancer, heart disease or stroke, fall and break a bone, or are in a serious accident.
- Traditional Medicare covers all the care you need from most physicians and hospitals across the US, without a referral or the need for prior approval.
- Medicare Advantage plans often limit access to a small network of physicians. They may engage in widespread inappropriate delays and denials of care, overriding your physicians’ opinions about the care you need. You often need prior approval for care.
Cost: Many older adults skip needed care because of high out-of-pocket costs.
- Traditional Medicare covers virtually all your out-of-pocket inpatient and outpatient costs, so long as you have supplemental coverage—Medicaid, retiree benefits, or Medigap, which you buy in the individual market for about $2,500 a year.
- Medicare Advantage plans charge deductibles and copays that average around $5,000 a year and can be as high as $7,550. Each one charges different amounts for in-network care and most do not cover out-of-network care.
Fraud: Some providers and Medicare Advantage plans have histories of engaging in fraud.
- Whether you’re in Traditional Medicare or Medicare Advantage, remember that not all health care providers are equal. Make sure you can trust your providers.
- Many health insurers offering Medicare Advantage plans have long histories of fraud against the government, including consumer protection-related violations. Before enrolling in a Medicare Advantage plan, protect yourself. Look up the insurance company on violationtracker.org. You can’t trust the Medicare star-ratings.
Incentives: Beware of physicians and insurers that profit from denying or delaying your care.
- Traditional Medicare pays for each service you receive, so physicians have no incentive either to withhold care you need or to keep you from seeing top specialists.
- Medicare Advantage plans are paid a flat upfront fee, so they have a financial incentive to keep you from getting costly care. The less care you get, the more they profit.
October 12, 2022
Medicare Advantage plans are an “Insatiable Cash Monster”
In a no holds barred expose, Reed Abelson and Margot Sanger-Katz report for the New York Times on the fraudulent activities of the largest health insurers offering Medicare Advantage plans. “The Cash Monster Was Insatiable’: How Insurers Exploited Medicare for Billions” takes a deep dive into how Medicare Advantage plans add diagnosis codes to patients’ medical records in order to receive higher payments from the government and drive up profits. The overpayments the Medicare Advantage plans collect increase Medicare spending to the tune of tens of billions of dollars each year and do nothing to ensure that people in Medicare Advantage plans get the care they need.

The story explains how Medicare Advantage insurers reward physicians with champagne, money and other goodies for adding diagnosis codes to patient records. Each diagnosis code means more money for the Medicare Advantage plans, which receive a fixed amount for each enrollee, adjusted up for enrollees with multiple diagnoses.

Abelson and Sanger-Katz explain how “major health insurers exploited the [Medicare Advantage] program to inflate their profits by billions of dollars. Of the five large Medicare Advantage participants, UnitedHealth, Humana, Elevance (formerly Anthem) and Kaiser Permanente have been charged with fraud for adding inappropriate diagnosis codes to patient files. The Justice Department is currently investigating CVS Health for related conduct.

Instead of saving money, Medicare Advantage costs taxpayers a lot more than traditional Medicare. One former government official projects that overpayments in 2020 alone totaled $25 billion and that overpayments will total $600 billion over the next nine years. Not surprisingly, the Kaiser Family Foundation reported that the companies offering Medicare Advantage plans generate twice as much gross profit from Medicare as from their commercial health insurance businesses.

For reasons unknown, the Centers for Medicare and Medicaid Services (CMS) has done a poor job of keeping the Medicare Advantage plans from overbilling the government and an equally poor job of collecting overpayments that are identified. Instead of reducing Medicare Advantage rates to adjust for the overbilling, CMS has increased them substantially, up eight percent in 2023. And, when CMS audits plans and finds overpayments, it only goes after the plans for the small number of overpayments it finds through its audits.

Where’s the value in Medicare Advantage? “Even when they’re playing the game legally, we are lining the pockets of very wealthy corporations that are not improving patient care,” according to Dr. Donald Berwick, the head of CMS during the Obama administration. Contrary to what some might believe, traditional Medicare offers better value than Medicare Advantage, as good or better care, particularly for people with complex and costly conditions, at lower cost.

Here’s more from Just Care:
October 12, 2022