Medicare Advantage Paid Billions for Questionable Home Diagnoses: Report
Health Care

Medicare Advantage Paid Billions for Questionable Home Diagnoses: Report

iStockphoto

For-profit insurers in the Medicare Advantage program boosted payments from the federal government by $4.2 billion last year after adding diagnoses for patients during home visits, even though those diagnoses did not result in any additional care, a new report from the Health and Human Services inspector general said Thursday.  

The insurers sent nurses to patients’ homes to perform health risk assessments, which in some cases resulted in additional medical issues being added to the patients’ charts. Medicare Advantage pays insurers more for care when patients are deemed to be sicker, even if treatments remain the same. A patient with a complex condition such as morbid obesity, for example, is worth more to the insurer, which can charge a higher rate for their care.

Investigators found that each home visit produced additional payments of $1,869 per patient on average, purely through increased payment levels rather than added care.

As The Wall Street Journal’s Christopher Weaver and Anna Wilde Mathews noted, the per-patient revenue increase found by the inspector general is similar to that found by the Journal in previous years. In August, the Journal reported that its own analysis found that between 2019 and 2021, insurers were paid an additional $1,818 per patient as a result of adding diagnoses to patient charts, and thereby increasing payment rates.

The bigger picture: Medicare Advantage was supposed to save money through efficiencies generated by marketplace competition, at least in theory, but insurers seem to have figured out ways to game the system in order to increase their profits.

“We’re seeing that some Medicare Advantage companies are making billions from the health risk assessment diagnoses without providing care for the conditions that they identify,” said Erin Bliss, assistant inspector general for evaluation and inspections, per the Journal. “Profiting off enrollees’ medical conditions without providing treatment for those conditions is wrong,” she added.

UnitedHealth, one of the largest providers of Medicare Advantage, disputed the findings. “A misleading, narrow, and incomplete view of risk adjustment data is being used to draw inaccurate conclusions about the value of in-home care for America’s most vulnerable seniors in Medicare Advantage,” a spokesperson said.

But to some observers, the news comes as no surprise. “I’m not wary of privatized Medicare Advantage plans because I’m a socialist, but because I’m a capitalist,” Brett Arends, a columnist at MarketWatch, wrote Thursday. “What part of ‘profit maximization’ do people not understand?”

TOP READS FROM THE FISCAL TIMES