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DOJ Takes Action on Medicare Advantage Overpayments

Posted by David Fong on Sep 28, 2017 6:00:00 AM

As you are well aware, Congress created Medicare Advantage (MA) as a risk adjustment payment program that pays insurers more for sicker beneficiaries. Payers in MA receive a yearly fee for each enrolled member and monthly risk adjustment payments for each enrolled beneficiary, based partly on the person’s health status. This program can be open to fraud. Medicare Advantage payers received about $160 billion in 2015 for approximately 16 million beneficiaries. HHS estimates that the FY 2015 Medicare Part C gross improper payment estimate is 9.50 percent or $14.12 billion, along with the FY 2015 net improper payment estimate of 4.32 percent or $6.41 billion.


Recently, the Department of Justice (DOJ), based on the claims of two whistleblowers, brought suit against UnitedHealth. The whistleblowers said UnitedHealth changed diagnosis codes to make patients seem sicker. These “data-mining projects” can raise Medicare reimbursements by nearly $3,000 for every diagnosis. The suit also alleges that employees collected bonuses for making these changes.

The UnitedHealth Group denies the DOJ’s claims, saying: “We are confident our company and our employees complied with the government’s Medicare Advantage program rules, and we have been transparent with CMS about our approach under its unclear policies.

CMS has a fairly broad definition of an acceptable diagnosis. Each diagnosis just needs to be justified by some record from a face-to-face encounter with a physician. This allows insurers significant ability to maximize their risk scores without resorting to fraud.

The Centers for Medicare and Medicaid Services (CMS) performs RADV audits to validate the accuracy of the HCC (Hierarchical Condition Category) codes submitted by MA (Medicare Advantage) plans for payment. A comprehensive accuracy review by an unbiased third party of your coding related, billing and reimbursement practices aimed at identifying potential problems can help your organization avoid possible legal challenges before they ever happen.

To ensure your organization does not unwittingly get caught up in such a legal battle, you should consider enlisting the services of a professional coding auditing services company, such as Aviacode. They can provide an accurate data validation review of your coding practices. Their experienced and credentialed auditors are compliant with the latest CMS coding guidelines.

Aviacode auditors utilize ProAuditor software, our proprietary application developed to streamline and standardize audits, and other audit resources to provide audit results that are actionable and easy to understand. Our expert auditors along with ProAuditor provide a powerful combination to help identify corrective actions, and provide support and training to make them happen. We offer chart audits to any size organization, from stand-alone physician clinics to multi-site hospital facilities.



Topics: Medical Coding, HCC Coding, Coding Compliance, Medical Coding Audits