Aetna has agreed to pay about $115 million to the U.S. government to settle allegations that the health plan manipulated the diagnosis codes for some of its enrollees to inflate those enrollees’ risk scores – a process known as upcoding.
A “risk score” is a measure that reflects the additional or reduced costs that each enrollee is expected to incur compared to the average enrollee and takes into account demographic characteristics, such as age and gender, as well as health status of each person enrolled in the plan. The federal government pays a Medicare Advantage plan more for enrollees with more serious chronic medical conditions who have a higher risk score than for healthier enrollees with lower risk scores.
A former Aetna risk-adjustment coding auditor, suing on behalf of the federal government, alleged Aetna was paid an inflated monthly payment amount by the Centers for Medicare & Medicaid Services (CMS) as a result of the alleged upcoding. Under the terms of the settlement, the claims resolved by the settlement are allegations only, and there has been no determination of liability.
As of this writing, Texas Medical Association payment staff believe physicians will not be impacted by the settlement but recommend they continue to ensure all coding remains accurate and well-supported by documentation.
According to the U.S. Department of Justice (DOJ), the settlement resolves allegations that in 2015, and again between 2018 and 2023, Aetna submitted or failed to withdraw diagnosis codes it knew or should have known were “inaccurate and untruthful.”
In 2015, the DOJ contends Aetna conducted a “chart review” program in which it paid diagnosis coders to review medical records and identify all medical conditions that the charts supported. The DOJ alleged the chart reviews did not substantiate some diagnosis codes previously reported to CMS and Aetna used the results of its chart reviews to identify instances where the payer might seek additional payments from the CMS while ignoring those same results when they indicated Aetna was overpaid.
From 2018 to 2023, the lawsuit alleged “Aetna submitted morbid obesity diagnosis codes to CMS when BMI values indicated the patients were, in fact, not morbidly obese. Aetna not only eliminated the internal process of reconciling conflicting medical information – the very process which was designed to ensure that morbid obesity diagnosis code are accurate – but also specifically directed coders to ignore conflicting information.”
“The government pays private insurers over $530 billion each year to care for Americans enrolled in Medicare Advantage,” said U.S. Assistant Attorney General Brett Shumate of the Justice Department’s Civil Division in the press release. “We will continue to hold accountable insurers that knowingly submit inaccurate or unsupported diagnoses to improperly inflate reimbursement.”
TMA’s Physician Payment Resource Center can help with billing, coding, payments, and other compliance issues. Members can speak directly with TMA's certified coders and staff by calling TMA’s Billing and Coding Hotline at 512-370-1414.
Alisa Pierce
Reporter, Division of Communications and Marketing
(512) 370-1469