Justice Department accuses Anthem of Medicare Advantage fraud

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    Diagnosis codes are supposed to be backed up by the patient’s medical record, but the federal government has in recent years accused several insurers of disregarding that rule. The Justice Department has also sued UnitedHealth Group over its Medicare Advantage billing practices but so far has been unsuccessful in court.

    One Anthem executive called the program a “cash cow,” the complaint states. The insurer’s retrospective chart review program produced a return-on-investment of up to 7 to 1.

    According to the lawsuit, one Anthem finance vice president estimated in 2017 that switching from a one-sided chart review to a program that deleted inaccurate codes would reduce the value of chart review for Anthem by 72% or $86 million that year.

    “As Anthem knew, identifying and deleting such inaccuracies in its diagnosis code submissions could lead CMS to calculate lower risk adjustment payments to Anthem. So it did not make an effort to do so,” the complaint said.

    Comment by Don McCanne of PNHP:  Many readers are aware that the private Medicare Advantage plans (previously Medicare + Choice) that were offered as a supposedly higher quality and lower cost option to traditional Medicare successfully engaged in deceptive favorable selection through cherry picking (e.g., marketing their plans to healthier beneficiaries in upstairs restaurant banquet rooms with no elevator) and lemon dropping (e.g., pulling out of markets with a disproportionately high percentage of beneficiaries with major health problems).

    Because the insurers were enrolling healthier patients while being paid at rates appropriate for a population that included a greater mix of chronically ill patients, it was recognized that their payment rates needed to be adjusted based on risk. Insurers would be paid more for those patients with greater health problems.

    We all know what happened next. Insurers began padding the diagnoses (upcoding) through chart reviews and home visits to make the patients appear more ill than they really were, and at the same time failing to remove diagnoses that were not adequately substantiated. As one Anthem executive said, this proved to be a “cash cow.”

    A similar Justice Department lawsuit against UnitedHealth did not get very far basically because adding additional diagnoses supposedly did not constitute a false claim even if the care rendered was not for the specific diagnoses added. That was just a good business practice on the part of the insurer, but that did not refute the fact that they were being paid for healthier patients at rates more appropriate for patients with multiple significant disorders.

    Try this experiment: list every disorder you have or have had, no matter how minor – headaches, allergic rhinitis, lumbar myalgia, refractive error, tinnitus, sunburn, pyrosis, URI, Trump disaffection syndrome, contusion, arthralgia, urinary urgency, white coat hypertension, and so on until you’ve listed 50 items. Then look at that list. Wow! Better call the paramedics… Of course, that’s silly, but it simply shows how easy it is to play games with taxpayer funds when you compare the business model of the private insurers with the service model of the public Medicare program.

    Look, it’s this private insurance industry that has really screwed up health care financing, wasting tremendous resources while setting up barriers to care, all to benefit their executives and passive shareholders. Why are we giving them a most-favored-status with our Medicare funds, or, for that matter, with funds for employer-sponsored plans, ACA exchange plans, and Medicaid managed care plans? It’s time to dump them and establish our own public single payer Medicare for All program that takes care of all of us equitably and efficiently.

    Jesus: Hey, Dad? God: Yes, Son? Jesus: Western civilization followed me home. Can I keep it? God: Certainly not! And put it down this minute--you don't know where it's been! Tom Robbins in Another Roadside Attraction

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