Senator Grassley to Go After Medicare Advantage Overbilling

Medicare Advantage insurance coverage has long relied on a subjective standard when assessing the condition of patients for billing purposes. To be sure, under Medicare Advantage, a program enacted by Congress in 2003, insurance providers must rate patients according to a specific "risk score"; the higher the risk score, the greater reimbursement the provider will receive from the federal government, and vice versa.

Of course, this had led to significant problems. Specifically, from 2008 to 2013, $70 billion was improperly allocated to Medicare Advantage plans, most of that likely due to over billing by the insurer.

Now, however, a key member of the Senate is taking action to help ensure that Medicare Advantage providers receive nothing more than their fair share, and, consequently, that taxpayers aren't forced to cover the costs of dubious claims. Recently, Senate Judiciary Committee Chairman Charles E. Grassley requested that Loretta Lynch, the United States Attorney General, tighten scrutiny on any plans suspected of over billing the Medicare program to protect hard-working Americans nationwide.

The Problems with Medicare Advantage

Medicare has undoubtedly had a positive effect on millions of Americans since its creation in the 1960s. Because of this social insurance program, senior citizens who have worked their whole lives have the chance to rely on the federal government to provide low-cost and effective healthcare coverage.

The problem, however, remains in the relatively deregulated program that is Medicare Advantage. Medicare Advantage plans are offered by private insurance companies that contract directly with Medicare. These healthcare plans provide patients with coverage, and then bill the federal government for any treatment administered.

Wherein, then, lies the problem? As mentioned above, in order to receive compensation from the federal government, the Medicare Advantage plan must submit an assessment of patients based on their risk score. And, as such, it is in the best interest of the private insurer's finances to inflate the score to help ensure a higher payout.

The Scope of the Problem

Is it truly possible that private insurance providers are submitting false or exaggerated information about patients, solely for additional compensation? According to a May 20 report from the Center for Public Integrity, a number of lawsuits referenced by Grassley allege that some private insurers engage in billing abuse "by altering patient records in order to claim patients are sicker than they actually are." Furthermore, the report also cites a study conducted by the Government Accountability Office, which asserts that more than $12 billion was improperly paid to Medicare Advantage plans in 2014 alone.

The Burden of the Taxpayers

Naturally, as with any other federal program, the burden of funding for Medicare falls on the American taxpayers. And, as such, a misappropriation of billions of dollars means that the taxes paid by millions of hardworking individuals in the United States will be siphoned off by plan providers looking to pad their pockets.

Unfortunately, until now the lack of transparency and set regulations in the Medicare Advantage plan has led to illicit billing on behalf of providers. Hopefully, however, Chairman Grassley, with the help of Attorney General Loretta Lynch, will be able to put a stop to these practices once and for all.


Grassley To Justice Department: Crack Down On Medicare Advantage Overbilling, by Fred Schulte, published at Health News from NPR,, on May 20, 2015.

Grassley to Attorney General Lynch: Crack Down on Medicare Advantage Overbilling, by Fred Schulte, published at The Center for Public Integrity, on May 20, 2015.