Op-Ed: Fraud Is Rampant in Medicare Advantage–Enforcing the False Claims Act can help

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    • #411184
      eridani
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      • Total Posts: 8,950

      https://www.medpagetoday.com/publichealthpolicy/medicare/91616

      Can a patient have and not have diabetes at the same time? According to private insurers participating in the Medicare Advantage program, the answer is yes. The data architecture of Medicare Advantage is vulnerable to fraud perpetrated by the Medicare Advantage Organizations (MAOs) who administer Medicare Advantage plans. These MAOs stand to collect inflated profits if they determine that their beneficiaries have complicating diagnoses for certain purposes but not for others.In the first system, the data flow is between the hospital and the MAO. In the second, it is between the MAO and the government. The problem arises because the government does not have real-time access to hospital claims data in the first system, and hospitals do not have access to the MAO’s reports to the government in the second system.

      Our diabetes example demonstrates the consequences of this lack of integration and transparency, particularly in the context of secondary diagnoses. For instance, suppose that a Medicare Advantage member with type 2 diabetes is admitted for surgery, and the hospital later codes this secondary diagnosis on its bill to the MAO. This diagnosis may move the episode of care into a more heavily weighted DRG, which can increase by thousands of dollars the amount the MAO must pay the hospital. These increased payments incentivize MAOs to challenge the propriety of such secondary diagnoses by contending that they are inactive conditions or otherwise irrelevant to the episode of care. Some MAOs have initiated programs to routinely delete certain diagnoses in order to downgrade DRGs and reduce payments to hospitals.

      In the first system, the data flow is between the hospital and the MAO. In the second, it is between the MAO and the government. The problem arises because the government does not have real-time access to hospital claims data in the first system, and hospitals do not have access to the MAO’s reports to the government in the second system.

      Our diabetes example demonstrates the consequences of this lack of integration and transparency, particularly in the context of secondary diagnoses. For instance, suppose that a Medicare Advantage member with type 2 diabetes is admitted for surgery, and the hospital later codes this secondary diagnosis on its bill to the MAO. This diagnosis may move the episode of care into a more heavily weighted DRG, which can increase by thousands of dollars the amount the MAO must pay the hospital. These increased payments incentivize MAOs to challenge the propriety of such secondary diagnoses by contending that they are inactive conditions or otherwise irrelevant to the episode of care. Some MAOs have initiated programs to routinely delete certain diagnoses in order to downgrade DRGs and reduce payments to hospitals.

      Comment by Don McCanne of PNHP:  It is not clear that the multitude of our Quote of the Day messages on the problems with the private Medicare Advantage plans have been getting through. Today’s message gets right to the point. The attorney authors of this article say it like it is: This is fraud!

      The Medicare Advantage plans are run by crooks. They use slick marketing to sell these plans to new arrivals in the Medicare program. They add nominal teaser benefits, plus they add the important benefit of providing catastrophic coverage. Although the purchasers of these plans may realize that they have limited networks, they are usually satisfied if their own primary care physician is on the list (not realizing that they may later develop problems that are best handled by physicians and facilities that are out of network). The more expensive patients soon learn that narrow networks and prior authorization requirements serve as significant barriers to the care that they need. The Medicare Advantage plans have developed a well earned reputation that the healthy go in and the sick come out. By outside appearances, the system does seem to work well enough for people that they have managed to entice into their programs, but those are individuals who have not discovered the problems lurking ahead.

      This article reveals the heart of the matter. The nation’s largest insurers are using these private Medicare Advantage plans to post record profits on the stock exchange. These excess profits are obtained by cheating the taxpayers who are paying for the Medicare program. Congress and the various administrations have been complicit since each year they authorize financing gimmicks that game the system, while neglecting much needed revisions to the traditional Medicare program – revisions such as reducing out-of-pocket expenses and establishing a reasonable cap on catastrophic losses.

      The wake-up call that we really need is for the public to realize what crooks these are and that it is time to get rid of them and to upgrade the traditional Medicare program so it works well for all of us – a single payer, improved Medicare for All. That won’t eliminate all abuses, but it would establish a financing framework that works much better for the patients and the taxpayers.

      The stakes for the new administration – and the country as a whole – are enormous. Over 23 million Medicare beneficiaries are enrolled in Medicare Advantage plans, for whom the federal government paid out $264 billion in 2019 alone. It is increasingly clear that these public funds are vulnerable to fraud. The HHS Office of Inspector General recently reported that in just one year $2.6 billion was paid to MAOs based on their reports of patient diagnoses that lacked supporting data from providers. It is widely anticipated that investigations and prosecutions of corporate fraud will increase under the Biden administration, and given the dollars at issue and the critical importance of our national healthcare system, fraud in the Medicare Advantage program should be a particular focus of this renewed enforcement effort.

      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

    • #411249
      Bernie Boomer
      Participant
      • Total Posts: 489

      “Medicare for All.”
      It’s not. It’s different. Better.
      Why would Jane and Joe Average 8th Grade Reading Comprehension want to buy-in to an upgraded Medicare for All after reading an article about rampant fraud within the Medicare Advantage system? They aren’t going to unpack that piece, they’re going to skim it and come away from the article with a Medicare=bad perspective that taints anything with that has that word in it.

      • #411658
        eridani
        Participant
        • Total Posts: 8,950

        But the thing about calling it Medicare is that everyone knows what that is–and strongly approves of it.

        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

    • #411250
      GZeusH
      Participant
      • Total Posts: 3,871

      How will Florida find its governors and senators?

      Corporate America consists of totalitarian entities laser-focused on short-term greed.

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