Medicare Advantage rip-offs

Medicare Advantage is a private sector alternative to traditional Medicare. The government pays Medicare Advantage insurers a set amount for each person who enrolls, with higher rates for sicker patients. By developing elaborate schemes to make their patients appear as sick as possible, the insurers get more money from the government. 

To maximize their profits, insurance companies employ firms to help them come up with money-making opportunities. A whistleblower uncovered an email that was sent by an insurance company executive to one of these consulting firms. It says, “You mentioned vasculatory disease opportunities, screening opportunities, etc with huge $ opportunities. Let’s turn on the gas!”

 Most of these private insurance companies, including ours, have been accused of fraud. Eight of the 10 biggest Medicare Advantage insurers have submitted inflated bills. For example, our insurer, Anthem (now called Elevance Health) pays more to doctors who said their patients were sicker. Executives at United Health Group told their workers to mine old medical records for more illnesses. When the workers couldn’t find enough, they were sent back to try again. 

In some of the schemes, patients are diagnosed with diseases that they don’t actually have. For example, one patient was diagnosed with bipolar disorder—which he didn’t have--giving Anthem an additional $2, 693.27.  Doctors and nurses have been pushed to document a range of diagnoses, including vertebral fractures, pneumonia and cancer they lacked the equipment to detect. And so on.  

Advantage companies also use deceptive marketing practices in order to sign up new customers. For example, they have posed as the IRS and other government agencies. They also prey on vulnerable people with dementia and cognitive impairment. Many people say they were enrolled in plans without realizing it.

In 2020, such fraudulent diagnoses cost the government $12 billion—enough to cover hearing and vision care for ever American over 65.

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