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Fraud in the Medicare Advantage Program: Washington Post Reports on Whistleblower and DOJ Enforcement Efforts

June 7, 2022

Christopher Rowland of the Washington Post recently took an in-depth look at fraud in the Medicare Advantage program.  The piece highlights several False Claims Act cases in this area, including cases against Sutter Health and Kaiser Permanente.  Both of these cases are near and dear to WLC attorney Erica Blachman Hitchings.  When in the government, Erica ran the Sutter and the Kaiser investigations, in partnership with other government officials and whistleblowers.  You can read more about these two landmark cases here.

Fighting Fraud in the Medicare Advantage Program is a Government Priority

Combatting fraud in the Medicare Advantage program is a government priority.  The DOJ emphasized this focus in a press release in February 2022.  And over the past few years, the government has investigated and sued several major insurance companies for Medicare Advantage fraud.

But the Washington Post article highlights what makes the Sutter Health and Kaiser Medicare Advantage Fraud cases so groundbreaking.  As Rowland notes:

For-profit insurance companies have typically been the primary target of these probes. More recently, unsealed whistleblower cases such as Ormsby’s against Sutter Health, and a pending case against Kaiser Permanente, reveal how such investigations have spread to prestigious, nonprofit physician and hospital groups.

The article also brings the fraud to life, pulling from papers filed in court. Kaiser Permanente, for example, allegedly convened “coding parties” where physicians would assemble after hours.  The purpose: add diagnosis codes to patient files in order to boost reimbursement.

According to the government, supervising physicians often pressured their colleagues to increase their capture of revenue.  But sometimes, physicians pushed back.  For example, the government cited internal correspondence from within a Sutter Health affiliate.  The email stated that a physician had complained that Sutter’s alleged practice of “pre-populating diagnoses into his visit encounter is possibly fraud.”  The physician reportedly had asked, “Does CMS know about what you all are doing?.”  (CMS is the government entity that oversees the Medicare program.)

The Ever-Growing Number of Medicare Advantage Beneficiaries

The article notes that Medicare Advantage plans cover an ever-increasing portion of the Medicare-eligible population.  In 2011, 26 percent of Medicare beneficiaries enrolled in the Medicare Advantage program.  By 2021, that number grew to 46 percent, or over 26 million individuals.

With so many beneficiaries enrolled — and so much money at stake — Medicare Advantage fraud is bound to continue for years to come.  Thankfully, however, the Department of Justice and other government agencies are fighting back.  But they need help, and that is where whistleblowers like the ones in the Sutter and Kaiser cases come in.

If you have information about possible Medicare Advantage or other managed care fraud, please contact us for a free consultation.  We have the expertise and desire to help.