‘The Cash Monster Was Insatiable’: How Insurers Exploited Medicare for Billions

[Greenbeard]

Really good look from the NYTimes this weekend at the lengths insurers participating in the privatized half of Medicare go to—up to and including outright fraud—to exploit aspects of the program designed to protect sicker patients’ access by paying insurers more for their care.

‘The Cash Monster Was Insatiable’: How Insurers Exploited Medicare for Billions

The health system Kaiser Permanente called doctors in during lunch and after work and urged them to add additional illnesses to the medical records of patients they hadn’t seen in weeks. Doctors who found enough new diagnoses could earn bottles of Champagne, or a bonus in their paycheck.

Anthem, a large insurer now called Elevance Health, paid more to doctors who said their patients were sicker. And executives at UnitedHealth Group, the country’s largest insurer, told their workers to mine old medical records for more illnesses — and when they couldn’t find enough, sent them back to try again.

Each of the strategies — which were described by the Justice Department in lawsuits against the companies — led to diagnoses of serious diseases that might have never existed. But the diagnoses had a lucrative side effect: They let the insurers collect more money from the federal government’s Medicare Advantage program.

Eight of the 10 biggest Medicare Advantage insurers — representing more than two-thirds of the market — have submitted inflated bills, according to the federal audits. And four of the five largest players — UnitedHealth, Humana, Elevance and Kaiser — have faced federal lawsuits alleging that efforts to overdiagnose their customers crossed the line into fraud.

The fifth company, CVS Health, which owns Aetna, told investors its practices were being investigated by the

Despite being created to introduce competition with traditional Medicare, Medicare Advantage has never actually saved the taxpayers money relative to traditional Medicare. In fact, it’s always cost more for the same set of benefits. Until a little over a decade ago, the formula for paying MA insurers hugely overpaid them. That was corrected by the ACA, which brought those payments in line with traditional Medicare. But even today with MA on paper paid at parity with traditional Medicare, it’s still ~4% more expensive due to the coding strategies described in the article.

Which isn’t to say MA is all bad. It’s got a much better, more modern benefit design than traditional Medicare (no need to buy supplemental coverage to fill gaps), its care and benefits can be better coordinated (though traditional Medicare has been getting better at this in the post-ACA world), and beneficiaries tend to get some additional benefits out of the largesse.

As for whether it’s delivering better care, a recent KFF lit review didn’t reveal a simple answer to that question:

We found few differences between Medicare Advantage and traditional Medicare that are supported by strong evidence or have been replicated across multiple studies. Both Medicare Advantage and traditional Medicare beneficiaries reported similar rates of satisfaction with their care and overall measures of care coordination. Medicare Advantage outperformed traditional Medicare on some measures, such as use of preventive services, having a usual source of care, and lower hospital readmission rates. However, traditional Medicare outperformed Medicare Advantage on other measures, such as receiving care in the highest-rated hospitals for cancer care or in the highest-quality skilled nursing facilities and home health agencies. Additionally, a somewhat smaller share of traditional Medicare beneficiaries than Medicare Advantage enrollees experienced a cost-related problem, mainly due to lower rates of cost-related problems among traditional Medicare beneficiaries with supplemental coverage. Several studies found lower use of post-acute care among Medicare Advantage enrollees but were inconclusive as to whether that was associated with better or worse outcomes. Findings related to the use of other health care services, including hospital care and prescription drugs, and condition-specific quality of care measures varied – likely due to differences in data and methodology across studies.

 

[HikerGuy83]

Somebody fleecing a government program.

Who'd of thought ?

 

[Greenbeard]

Somebody fleecing a government program.

Who'd of thought ?

This is the privatized portion of Medicare. And I don't imagine there's any appetite for rolling it back.

 

[HikerGuy83]

This is the privatized portion of Medicare. And I don't imagine there's any appetite for rolling it back.

So, Medicare isn't a government program ?

Who knew ?

 

[dockside]

So, Medicare isn't a government program ?

Medicare is a government program. It covers all hospital charges and 80% of doctors' charges, after payment of a deductible. Private Medicare Part B is made up of several plans, most of which cover the deductibles and one which pays everything Medicare Parts A and B don't pay. Then, there is a Medicare Advantage which replaces Part B. IMO, having had both, I would never, ever go with an Advantage program. It is an HMO so you have to make sure your doctor participates in it and also your hospital. During the years I had an advantage, I wasn't able to find a specialist that participated in my Advantage plan and the only hospital in my county, for several months, was not part of the insurer's "network" and would only take emergency patients that had my insurer. If I had had a Part B and a supplement, I could go to any doctor who participated in Medicare (almost all of them do). I wouldn't matter who my supplement insurer was.

So, there you have it. Medicare is primarily government but most people have a supplement plan and insurer in the private sector. They are not required to even have Part B or a supplement.

 

[Geoist]

So, Medicare isn't a government program ?

Who knew ?

Medicare Advantage is NOT a government program.

Congressman Pocan just drew up legislation to force a name change. Seniors have been duped and it shouldn't have been allowed in the first place.

 

[HikerGuy83]

Medicare Advantage is NOT a government program.

Congressman Pocan just drew up legislation to force a name change. Seniors have been duped and it shouldn't have been allowed in the first place.

The point being that government programs are generally ripe for this kind of abuse.

And there is always someone willing to take advantage of them.

 

[Greenbeard]

The point being that government programs are generally ripe for this kind of abuse.

And there is always someone willing to take advantage of them.

No doubt.

 

[HikerGuy83]

No doubt.

Absolutely.

Thank you for supporting my point.

 

[jaeger19]

Really good look from the NYTimes this weekend at the lengths insurers participating in the privatized half of Medicare go to—up to and including outright fraud—to exploit aspects of the program designed to protect sicker patients’ access by paying insurers more for their care.

‘The Cash Monster Was Insatiable’: How Insurers Exploited Medicare for Billions

Despite being created to introduce competition with traditional Medicare, Medicare Advantage has never actually saved the taxpayers money relative to traditional Medicare. In fact, it’s always cost more for the same set of benefits. Until a little over a decade ago, the formula for paying MA insurers hugely overpaid them. That was corrected by the ACA, which brought those payments in line with traditional Medicare. But even today with MA on paper paid at parity with traditional Medicare, it’s still ~4% more expensive due to the coding strategies described in the article.

Which isn’t to say MA is all bad. It’s got a much better, more modern benefit design than traditional Medicare (no need to buy supplemental coverage to fill gaps), its care and benefits can be better coordinated (though traditional Medicare has been getting better at this in the post-ACA world), and beneficiaries tend to get some additional benefits out of the largesse.

As for whether it’s delivering better care, a recent KFF lit review didn’t reveal a simple answer to that question:

For some services, like outpatient therapies.. my patients with Advantage plans pay more than if they had only part B with NO supplement. The specialist fee that they must pay is HIGHER than what the 20% they would have been charged with just part B.

Not to mention that they can only access providers that accept that advantage plan, have hard limits to the number of visits they can have etc.

 

[The Old Soul]

Medicare Advantage is NOT a government program.

Congressman Pocan just drew up legislation to force a name change. Seniors have been duped and it shouldn't have been allowed in the first place.

How Much Does the Government Pay Medicare Advantage Plans?​

The federal government pays out over $1,000 each month for each enrollment for every individual. $1,000 is a substantial amount when considering the number of enrollees they see, and bonus payments received through the bonus system.

 

[Greenbeard]

More bad behavior by Medicare Advantage plans detailed in the NY Times today:

Private Medicare Plans Misled Customers Into Signing Up, Senate Report Says

Companies selling private Medicare plans to older adults have posed as the Internal Revenue Service and other government agencies, misled customers about the size of their networks and preyed on vulnerable people with dementia and cognitive impairment, according to a new investigation of deceptive marketing practices in the industry released Thursday by Democrats on the Senate Finance Committee.

Many individuals say they were enrolled in plans without realizing it.

The report catalogs complaints from 14 states, and a multitude of marketing materials generated by the insurers and the companies they hire to help sell the private plans.

Defrauding the government/taxpayers and the consumers? Tsk tsk.