US Justice Department launches probe against UnitedHealth for alleged medicare billing fraud

The United States Justice Department has launched a civil fraud investigation against UnitedHealth Group regarding the Medicare bills of the company. This inquiry is aimed at how UnitedHealth is registering diagnoses to trigger increased federal outflow for the Medicare Advantage programme that includes physician groups owned by the insurance outfit.

A Wall Street Journal report stated that the probe came on the heels of a spate of exposes that revealed how UnitedHealth allegedly raked billions in dollars in payments for dubious diagnoses. Shares of the company tumbled over 7 percent as news of the probe broke, Reuters reported.

On January 31, per the WSJ report, the attorneys from the Department of Justice interviewed the hospitals and medical providers mentioned in these reports. UnitedHealth has denied the claims, calling them “fake.”

Allegations of Inflated Diagnoses

In the case of Medicare Advantage, per the WSJ report, the participating insurers receive fixed payments from the US government to provide Medicare benefits to their enrollees. The payments are adjusted upward depending on the diagnosis of the patients, thus incentivising the insurers to have more conditions documented.

Reportedly, it was alleged that UnitedHealth actively promoted inflation of diagnoses by doctors employed directly by them sometimes to include conditions which were not actually treated.

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Reports suggested that the doctors were trained to document revenue-generating diagnoses, some being obscure or unnecessary. Secondly, the software of UnitedHealth would suggest conditions, and doctors would financially benefit from using those conditions.

The nurses visiting in-home under UnitedHealth’s house calls unit would document conditions which generated additional payments from the government. Lastly, there were also instances when conditions like secondary hyperaldosteronism were added without lab testing, in essence treating secondary hyperaldosteronism as an afterthought.

The report by the Wall Street Journal claims that untreated diagnoses garnered an extra $8.7 billion in federal payments to UnitedHealth in 2021 alone.

Legal Scrutiny and Company Response

The Justice Department of the US and the Office of Inspector General at the Department of Health and Human Services have now investigated those allegations. Attorneys are contacting the doctors and nurses-practitioners named in media reports and asking questions as to incentives, diagnoses, and internal pressure for alterations of medical records.

UnitedHealth denied any wrongdoing and argued that its practices actually help detect diseases earlier and ultimately save healthcare costs. In the wake of the Wall Street Journal article, the company claimed to be unaware of the investigation and accused the paper of having led a "year-long campaign" against Medicare Advantage.

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That civil fraud probe is completely unrelated to a much broader Justice Department antitrust investigation against UnitedHealth, which is also dealing with litigation regarding its $3.3 billion acquisition of home-health company Amedisys.

FAQs

1. What is the UnitedHealth case under investigation for?

It is under investigation for allegations that the company inflated diagnoses in its Medicare Advantage plans to gain federal payments. Reports indicate that doctors were pressured to write down conditions that were unnecessary or lacked adequate support.

1. What effect has the investigation had on UnitedHealth?

The share price of UnitedHealth fell 7.3 percent, impacting the broader Dow Jones Industrial Average after the news of the probe broke. The company is under continued legal scrutiny concerning its business practices.