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An older woman gets a checkup at home. Photo: Jahi Chikwendiu/The Washington Post via Getty Images

Dialysis chain DaVita this week agreed to pay $270 million to settle allegations that physicians in its medical group fudged how sick their patients were so they could get paid more from Medicare Advantage plans — which in turn got higher payments from the federal government.

Why it matters: DaVita's settlement eliminates a three-year-old probe. But the entire Medicare Advantage industry — estimated to cost the federal government $250 billion in 2019 — remains under the microscope for gaming the payment system.

What's next: The Department of Justice is continuing its investigation of the coding practices of the largest health insurance companies in the country.

  • Aetna, Anthem, Centene, Cigna, Humana and UnitedHealth Group have disclosed to investors in quarterly securities filings that DOJ is probing their "risk adjustment practices" as part of a "wider review of Medicare risk adjustment generally that includes a number of Medicare Advantage plans, providers and vendors."
  • UnitedHealth also is battling a whistleblower lawsuit that alleges the insurer went through patient medical records and purposely exaggerated diagnoses. UnitedHealth says the lawsuit has no merit and says federal rules have been unclear.
  • DaVita's settlement covers allegations it not only looked back and submitted diagnosis codes that could not be supported medically, but also did not delete unsubstantiated codes.
  • Coincidentally, DaVita is selling the physician group involved in the settlement to UnitedHealth. Federal antitrust regulators are still reviewing the deal.

How it works: Health insurers that sell Medicare Advantage plans assign "risk scores" to their members, based on the health conditions they have. The higher the risk score, the more conditions someone has, and the more money the insurer gets for covering them.

  • Yes, but: Research and reporting have found payments to Medicare Advantage plans "exceed what is warranted" because of the industry's aggressive, yet technically legal, medical record coding.

The big picture: The federal government expects more than 22 million seniors and disabled people, or about 37% of all Medicare enrollees, to be in a Medicare Advantage plan next year. Wall Street predicts half of all Medicare beneficiaries will be in Medicare Advantage by 2021.

  • Growth in the program won't wash away concerns about coding. Pending whistleblower suits allege Medicare Advantage insurers and coding vendors aggressively document patients' health statuses during home visits.

Go deeper

8 hours ago - World

Over 170 Palestinians injured in clashes with Israeli police in Jerusalem

An injured man is carried away as Israeli security forces clash with Palestinian protesters at the al-Aqsa mosque compound in Jerusalem. Photo: Ahmad Gharabli/AFP via Getty Images

At least 178 Palestinians have been injured in clashes with Israeli police in Jerusalem, Reuters reported late Friday.

The big picture: The clashes come amid growing anger over the threatened eviction of Palestinians from their homes on land claimed by Jewish settlers in East Jerusalem. Tensions have also escalated in the occupied West Bank in recent weeks.

Updated 10 hours ago - Politics & Policy

Coronavirus dashboard

Illustration: Annelise Capossela/Axios

  1. Health: Coronavirus cases hit a seven-month low — Majority back vaccine proof requirements for travel, schools and work — The race to avoid a possible "monster" COVID variant.
  2. Politics: Oklahoma secures $2.6 million refund for hydroxychloroquine purchase — Why Biden's latest vaccine goal is his hardest yet.
  3. Vaccines: Pfizer begins application for full FDA approval of COVID-19 vaccine — Moderna says its COVID booster shot shows promise against variants.
  4. Economy: U.S. adds just 266,000 jobs in April, far below expectations — Americans' return to the skies could benefit smaller airlines.
  5. World: WHO authorizes China's Sinopharm COVID-19 vaccine for emergency use — Mixed response in Europe to Biden's vaccine patents bombshell.
  6. Variant tracker: Where different strains are spreading.

Ohio GOP censures Rep. Anthony Gonzalez over Trump impeachment vote

Photo: Bill Clark/CQ-Roll Call, Inc via Getty Images

The Ohio Republican Party on Friday censured Rep. Anthony Gonzalez (R-Ohio) and called for him to resign for voting to impeach former President Trump in January, Reuters reports.

The big picture: Gonzalez is the latest Republican lawmaker to be punished for voting to impeach the former president on a charge of inciting the deadly Jan. 6 insurrection.