Federal enforcement around Medicare Advantage risk adjustment and billing has ramped up over the past two years, producing multimillion-dollar settlements with insurers, provider groups, and the vendors that handle their diagnosis coding.
The combined value of the settlements comes to roughly $950 million, though some amounts were structured around the defendants’ ability to pay. In each case the settlements resolved allegations only, and none of the organizations admitted wrongdoing.
Six recent Medicare Advantage fraud settlements:
1. Matrix Medical Network, HealthFair, and founder James Ekbatani agreed June 3 to pay a combined $56.5 million to resolve allegations they submitted false diagnosis codes to inflate Medicare Advantage payments. The government said Matrix caused MA plans to submit unsupported diagnoses including atrial fibrillation, rheumatoid arthritis, and COPD between 2014 and 2019, while HealthFair’s alleged conduct from 2015 to 2017 involved diagnoses such as HIV/AIDS, metastatic cancer, and congestive heart failure. HealthFair was acquired by Matrix in 2018 and shut down by 2020.
2. Aetna agreed March 10 to pay $117.7 million to resolve allegations it submitted or failed to withdraw inaccurate diagnosis codes to inflate its MA payments. The largest portion, $106.2 million, stems from a 2015 chart review program, while $11.5 million resolves allegations tied to morbid obesity codes submitted between 2018 and 2023. A whistleblower who worked as a risk-adjustment coding auditor at the company will receive about $2 million.
3. Kaiser Permanente agreed Jan. 14 to pay $556 million, the largest Medicare Advantage fraud settlement to date, to resolve allegations it submitted unsupported diagnosis codes to boost risk-adjusted payments. The government alleged that from 2009 to 2018 in California and Colorado, Kaiser pressured physicians to add diagnoses to patient records after visits had already occurred. The five Kaiser affiliates did not admit wrongdoing, and the whistleblowers will receive roughly $95 million.
4. Seoul Medical Group and Renaissance Imaging Medical Associates agreed March 26, 2025 to pay a combined $62.85 million to resolve allegations they submitted false spinal diagnosis codes to inflate Medicare Advantage payments. Prosecutors said that from 2015 to 2021, Seoul submitted diagnoses for spinal enthesopathy and sacroiliitis that patients did not have, and that Renaissance created false radiology reports to support them.
5. Independent Health and DxID agreed Dec. 20, 2024 to pay up to $100 million to resolve allegations that the now-defunct DxID retroactively mined medical records to add diagnoses that inflated MA risk scores. The case closed a roughly 12-year whistleblower lawsuit, and Independent Health did not admit wrongdoing.
6. Oak Street Health agreed Sept. 18, 2024 to pay $60 million to resolve allegations it violated the False Claims Act by paying kickbacks to third-party insurance agents to recruit seniors to its primary care clinics. Through a program called the Client Awareness Program, the company paid agents roughly $200 per MA beneficiary referred between September 2020 and December 2022. CVS Health purchased Oak Street in 2023.
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