Kaiser Permanente Affiliates Settle for $556 Million
An affiliate of Kaiser Permanente will pay $556 million to resolve allegations of Medicare fraud and undue pressure on doctors to falsify diagnoses in medical records for increased reimbursements, according to federal prosecutors. This settlement, revealed on Wednesday, comes over four years after the U.S. Department of Justice filed a motion in San Francisco to unify six whistleblower claims.
The entities involved in this agreement include the Kaiser Foundation Health Plan, Kaiser Foundation Health Plan of Colorado, Permanente Medical Group, Southern California Permanente Medical Group, and Colorado Permanente Medical Group P.C. Based in Oakland, California, Kaiser is among the largest not-for-profit health plans in the U.S., serving over 12 million members through various medical centers.
The lawsuit suggests that Kaiser exploited the Medicare Advantage plan system, also known as Medicare Part C, which allows beneficiaries the choice of managed care insurance plans. Prosecutors indicated that Kaiser exerted pressure on doctors to amend medical records, often months after initial consultations with patients. This was significant because a more severe diagnosis usually meant higher payments for the insurance plans.
Assistant Attorney General Brett A. Shumate noted, “More than half of our nation’s Medicare beneficiaries are enrolled in Medicare Advantage plans, and the government expects truthful and accurate information from program participants.”
Kaiser stated that the settlement does not imply any admission of wrongdoing or liability. They opted for this route to sidestep “delays, uncertainties, and costs” associated with a trial. Furthermore, Kaiser commented that other major health plans are under similar scrutiny concerning their Medicare Advantage risk adjustment practices, indicating broader challenges within the industry. They clarified that the lawsuit was not about the quality of care provided to members but revolved around the interpretation of documentation rules for the Medicare Risk Adjustment Program.
