DOJ alleges Medicare Advantage plans paid illegal kickbacks
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The U.S. Department of Justice. Photo by Jabin Botsford/The Washington Post via Getty Images
The Justice Department on Thursday sued three of the biggest Medicare Advantage insurers, charging they paid insurance brokers hundreds of millions of dollars in illegal kickbacks to steer seniors into their plans.
Why it matters: The case in U.S. District Court for the District of Massachusetts signals that the Trump administration is open to scrutinizing the privately-run Medicare program that now covers more than half of U.S. seniors.
- "We are committed to rooting out illegal practices by Medicare Advantage insurers and insurance brokers that undermine the interests of federal health care programs and the patients they serve," Deputy Assistant Attorney General Michael Granston said in a release.
Where it stands: The False Claims Act complaint states that Aetna, Elevance (formerly Anthem) and Humana entered into illegal agreements with Medicare brokerages eHealth, GoHealth and SelectQuote to get them to enroll more seniors in their respective plans.
- Both the insurers and the brokers knew these arrangements, which stretched from 2016 through at least 2021, were illegal, the complaint states. The brokers are also named as defendants.
- DOJ also alleges that Aetna and Humana leveraged illegal kickbacks to brokers to enroll fewer Medicare enrollees with disabilities, since they're often more expensive to cover.
Medicare Advantage plans are typically required to accept any eligible senior in their service area who wishes to enroll, regardless of pre-existing conditions.
What they're saying: "We are still reviewing the complaint, but disagree with the allegations and intend to defend the case vigorously," Phillip Blando, executive director of external affairs for Aetna and CVS Caremark, told Axios.
- Humana also said in a statement that it strongly disagrees with the allegations and will defend itself in the legal proceedings.
- GoHealth told Axios it was disappointed in the government's decision to intervene several years after an initial whistleblower complaint was filed.
- "We intend to vigorously defend against these allegations, and we will not allow this litigation to distract from our mission to provide peace of mind to the Medicare beneficiaries that we serve," the company said in a statement.
- Elevance, eHealth and SelectQuote did not immediately respond to Axios request for comment.
The Justice Department is asking a judge to require the companies pay back all damages to the government plus maximum applicable fines for each False Claims Act violation.
