Aetna to pay $117.7M to settle Medicare Advantage false claims case

Aetna has agreed to pay $117.7 million to resolve allegations that it violated the False Claims Act by submitting inaccurate or untruthful diagnosis codes for its Medicare Advantage Plan enrollees, according to a Department of Justice press release.

The alleged practice can result in fraudulent overpayments to Medicare Advantage plans, which United States Attorney General David Metcalf said is a diversion of government resources.

"The government pays Medicare Advantage Organizations to facilitate vital healthcare to our seniors and other vulnerable citizens," Metcalf said in the press release.
"When corporations or individuals threaten the Medicare Advantage program by diverting those limited government resources through fraud, waste or abuse, we will continue to pursue all available remedies against them."

Medicare Advantage operates by having plans submit diagnosis codes to the Centers for Medicare & Medicaid Services (CMS) to determine the monthly payment each plan will receive. Those diagnosis codes inform risk adjustment, which ensures plans that cover sicker or more complex patients -- meaning patients who are more expensive to cover -- will get higher monthly payments.

The lawsuit contends that Aetna submitted diagnosis codes to CMS that inaccurately or untruthfully inflated its risk pool.

In 2015, the payer received charts from its contracted provider partners for individuals covered by Aetna's Medicare Advantage plan. Typically, Medicare Advantage plans use these charts to conduct a chart review and then submit diagnosis codes to CMS.

But according to the court, Aetna submitted additional diagnosis codes to CMS "that the healthcare providers had not reported for the beneficiaries to obtain additional payments from CMS," the court said.

As part of the lawsuit, the United States argued that Aetna used its chart reviews to seek additional payments from CMS but did not use those same results when it provided information about potential overpayments. A total of $106,200,000 of the settlement amount resolves those allegations, the Department of Justice said.

The remaining $11,500,000 of the settlement will resolve allegations that between 2018 and 2023, Aetna knowingly submitted or failed to delete inaccurate and untruthful diagnosis codes for morbid obesity among individuals without a BMI to substantiate those diagnosis codes. This resulted in overpayments from CMS, the court said.

"Medicare Advantage relies on accurate reporting and attempts to manipulate the system undermine both the program's integrity and the beneficiaries it serves," Acting Deputy Inspector General for Investigations Scott J. Lampert of the U.S. Department of Health and Human Services, Office of Inspector General, said in a statement.

"Today's settlement makes clear that no company is beyond accountability, no matter how large or well known. Those who seek to exploit Medicare Advantage should expect to be identified and held responsible, and HHS‑OIG will continue to protect taxpayer funds and the integrity of this vital program."

According to Assistant Attorney General Brett A. Shumate of the Justice Department's Civil Division, Medicare Advantage plans can expect the Department to continue monitoring for fraudulent practices.

"The government pays private insurers over $530 billion each year to care for Americans enrolled in Medicare Advantage,” Shumate said in the press release. "We will continue to hold accountable insurers that knowingly submit inaccurate or unsupported diagnoses to improperly inflate reimbursement."

Sara Heath has reported news related to patient engagement and health equity since 2015.