Alarming patterns keep cropping up in the Medicare Advantage program, and whistleblowers could be key to protecting both patients and taxpayers.
More than half of the roughly 100 million Medicare beneficiaries choose this program, which is supposed to offer patients a health plan comparable to traditional Medicare administered by private insurance companies at less cost to the government.
The problem: As more and more beneficiaries have elected Medicare Advantage it is proving to be more expensive than traditional Medicare. The U.S. government spent an estimated $454 billion on Medicare Advantage in 2023 with growing questions about whether those billions are going to take care of beneficiaries – or are enriching the private companies administering these plans.
A recent article in The Wall Street Journal raised the question of whether private insurers benefit from Medicare Advantage enrollees while they’re healthy but deny coverage when costly illnesses arise, prompting the patients to switch to traditional Medicare plans. Advantage plans require advance approval for many treatments and specify which doctors members can use. The fee for service model in traditional plans does not have the same prior authorization requirements.
When beneficiaries do this – and they increasingly do it when the scrutiny in the Medicare Advantage plans become an obstacle to care – it ultimately costs Medicare (and taxpayers) twice: Paying the private insurers for minimal care when patients are healthy, then paying for costly services when patients get sick and switch back to traditional Medicare.
Where do these suspicions come from?
An analysis by health policy nonprofit KFF found that Medicare spent an average of 27 percent more for people who switched from Medicare Advantage to traditional Medicare compared with those who had always been with the traditional program. That was after adjusting for differences in health status and other characteristics, and it meant an average difference of $2,585 in Medicare spending per person between the two groups.
There were multiple other findings, as well, raising similar questions.
A recent U.S. Senate subcommittee report found that private insurers are more likely to deny prior authorization for coverage of post-acute care, such as stays in skilled nursing facilities, than for other services.
“Insurance companies say that prior authorization is meant to prevent unnecessary medical services. But the Permanent Subcommittee on Investigations has obtained new data and internal documents from the largest Medicare Advantage insurers that discredit these contentions,” U.S. Sen. Richard Blumenthal (D-Connecticut), chair of the subcommittee, said in an October statement. “In fact, despite alarm and criticism in recent years about abuses and excesses, insurers have continued to deny care to vulnerable seniors—simply to make more money. Our Subcommittee even found evidence of insurers expanding this practice in recent years.”
When private companies contract with the government to administer these plans and knowingly manipulate the payment mechanisms to keep payments from the government as profits rather than paying for patient care, whistleblowers could play a key role in both protecting these patients and in preventing fraud against the federal government (and thus, taxpayers).
If you have insight into these practices and suspect fraudulent activity, contact Keller Grover for a free and confidential consultation. Our experienced whistleblower attorneys can answer questions and provide prudent next steps. Whistleblowers who help expose fraud against the federal government also are eligible for 15 percent to 30 percent of recoveries as an award.