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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

Updated 1 hour ago - Politics & Policy

Supreme Court rejects Trump's attempt to shield documents from Jan. 6 committee

Photo: Melissa Sue Gerrits/Getty Images

The Supreme Court rejected on Wednesday night a bid by former President Trump to block the release of documents and records from his administration to the House committee investigating the Jan. 6 riot at the Capitol.

Why it matters: Trump asked the Supreme Court to step in and block the release of the documents last month after a panel on the U.S. Court of Appeals for the D.C. Circuit unanimously denied his attempt to prevent the committee from obtaining the materials.

Senate Republicans block voting rights bill

Senate Minority Leader Mitch McConnell walks to the Senate floor on Jan. 18. Photo: Eric Lee/Bloomberg via Getty Images

Senate Republicans blocked Democrats' voting rights legislation from coming to a final vote on Wednesday in what was largely viewed as a doomed effort from the start.

Why it matters: The failed vote underscores the Democratic Party's current uphill battle to pass sweeping legislation in a 50-50 Senate.

Updated 2 hours ago - Politics & Policy

Biden says Russia likely to invade Ukraine

President Biden addressed the brewing conflict between Russia and Ukraine during a press briefing Wednesday, saying of Russian President Vladimir Putin, "my guess is he will move in."

Why it matters: U.S. officials have issued a series of warnings about Russia's threatening military buildup on the border with Ukraine, with Secretary of State Antony Blinken saying in Kyiv earlier Wednesday that Russia could invade "on very short notice."