Aetna has agreed to pay $117.7 million to resolve allegations that it violated the False Claims Act by submitting or failing to withdraw inaccurate diagnosis codes for its Medicare Advantage enrollees in order to increase payments from CMS.
The settlement comes amid a wave of federal scrutiny over risk-adjustment practices across the MA industry this year alone, following a record $556 million settlement with Kaiser Permanente in January and an ongoing enrollment sanction threat against Elevance Health.
Under the MA program, CMS pays insurers a fixed monthly amount per enrollee, adjusted upward for sicker patients based on diagnosis codes submitted by the plan. The federal government said March 10 that Aetna exploited that system by submitting diagnosis codes it knew to be inaccurate in order to inflate payments, and then failing to withdraw those codes when its own internal chart reviews revealed they were unsupported by patient medical records.
The largest portion of the settlement, $106.2 million, covers allegations tied to a chart review program Aetna operated for payment year 2015. According to the Justice Department, Aetna hired diagnosis coders to review medical records from providers to identify additional conditions and submit new diagnosis codes.
The remaining $11.5 million resolves allegations that between payment years 2018 and 2023, Aetna submitted or failed to delete inaccurate diagnosis codes for morbid obesity for members whose recorded body mass index was inconsistent with that diagnosis.
The morbid-obesity portion stems from a whistleblower lawsuit filed by a former Aetna risk-adjustment coding auditor under the False Claims Act’s qui tam provisions. The whistleblower will receive more than $2 million from the settlement.
“Aetna continues to disagree with the DOJ’s industry-wide allegations, and this settlement should not be seen as an acknowledgment of liability,” a spokesperson for the insurer told Becker’s. “Instead, we are now able to avoid the uncertainty and further expense of prolonged litigation, as we maintain our focus on delivering first-in-class member experience across our Medicare Advantage plans.”
