Providers & patients alike launch tsunami of complaints against Medicare Advantage
The highly popular Medicare Advantage (MA) insurance program takes center stage among current healthcare news topics, as a class action lawsuit involving use of artificial intelligence has combined with uproars over reform plans and sales commissions to embroil MA in a multitude of struggles.
First, the Medicare Payment Advisory Commission is grappling with a tsunami of complaints from healthcare providers and patients alike about MA’s policies on topics ranging from coverage transparency to provider directories to the process for appealing coverage denials.
Class action lawsuit against UnitedHealth alleges illegal AI adoption
Second, the estates of two deceased elderly patients have filed a class action lawsuit against UnitedHealth Group, the nation’s largest private healthcare insurer, alleging its illegal adoption of artificial intelligence in analyzing insurance claims improperly denies patients’ claims for extended care such as nursing facility stays.
The suit charges United for continuing to “systematically deny claims using their flawed AI model because they know that only a tiny minority of policyholders (roughly 0.2%) will appeal denied claims….”
CMS moves against insurance agents improperly pushing high-sales-commission plans
Third, the Centers for Medicare & Medicaid Services (CMS) has proposed a rule that would stop insurance company agents from steering customers into MA and Medicare Part D plans paying the highest sales commissions, rather than those better serving customer needs.
Currently, agents can earn as much as $1,300 in commissions on one sale for one year’s enrollment from “incentive fees,” according to testimony in a recent Senate hearing.
The good news: Savings in overpayments
However, not all is unwell in the MA universe. On November 15, the CMS reported that it made $16.6 billion in overpayments to MA organizations in the 2023 fiscal year.
While that sounds like a mountain of greenbacks to the average person, the amount is in fact 4 percentage points below the target maximum rate of 10% of total disbursements – and, CMS said, “not all improper payments constitute fraud or abuse.”
Nevertheless, expect MA to remain in the spotlight for retirement-age healthcare consumers, especially now that more than half (51%) of the Medicare eligible population is enrolled in MA plans.
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