Oakland, Calif.,-based Kaiser Permanente affiliates will pay $556 million to settle a lawsuit that alleges the health care giant committed Medicare fraud and pressured doctors to list incorrect diagnoses on medical records to receive higher reimbursements.
Prosecutors contended that Kaiser “pressured its physicians to create addenda to medical records,” often months or more than a year after an initial consultation with an enrollee, The Associated Press reported.
The settlement followed a four-year investigation by the Department of Justice that began with complaints from six whistleblowers.
Affiliates in the settlement include the Kaiser Foundation Health Plan; Kaiser Foundation Health Plan of Colorado; The Permanente Medical Group; Southern California Permanente Medical Group; and Colorado Permanente Medical Group P.C.
Ross Marchand, executive director of Taxpayers Protection Alliance (TPA) was not surprised by the news.
"The government in this case has long claimed that the $100 billion company made Medicare Advantage members' diagnoses worse than they actually were to get more money from taxpayers, but this fraud scandal is just the tip of the iceberg and certainly not just limited to Medicare Advantage."
Kaiser’s statement on Wednesday denied fraud but confirmed government interest in a number of other providers.
“Multiple major health plans have faced similar government scrutiny over Medicare Advantage risk adjustment standards and practices, reflecting industrywide challenges in applying these requirements,” the group said. “The Kaiser Permanente case was not about the quality of care our members received. It involved a dispute about how to interpret the Medicare risk adjustment program’s documentation requirements.”
Pointing to information from the Government Accountability Office (GAO), Marchand said there is a combined $100 billion in improper payments made by the taxpayer-funded Medicare and Medicaid programs per year.
"That's more than $600 annually for each and every Medicare and Medicaid patient," said Marchand. "This is completely unacceptable."
