Medicare backed off under pressure from health insurers

Dive Brief:

Dive Insight:

Fraud has long been a major issue for the Medicare program, and government officials and politicians periodically argue for a crackdown that will save the taxpayers millions of dollars. But in this set of audits, it appears that even when the government has evidence of wrongdoing, collecting the money is another issue.

Of primary concern is that CMS estimated that the five health plans that it spent two years auditing—Humana, PacifiCare, Aetna, Independence Blue Cross, and Lovelace—owed between $13 million and almost $34 million each. But after arguing for another two years, CMS negotiated the repayments down to a tiny fraction of those amounts. The health plans, as well as insurance industry representatives, claimed that the audits were flawed, and therefore the audit results were not reliable. CMS spokesman Aaron Albright said repayments would be calculated differently for future audits, reported Kaiser Health News.

Also disturbing is the agency’s attempt to keep the process quiet. Articles published by CPI spurred Sen. Chuck Grassley to ask questions that the issue received any real attention. Ultimately, it was not until CPI filed its FOIA lawsuit that the details of the audit and repayment amounts were disclosed.

By allowing these insurers to avoid accountability, CMS sets a dangerous precedent, especially given the number of insurers that have been caught “upcoding,” claiming a patient is sicker than clinically indicated in order to charge higher fees. Furthermore, the story casts CMS in a negative light just when elderly and disabled participants are fearful that Medicare will be cut back or substantially altered by Republicans.

Filed Under: Payer Health Law Finance