Medicare Advantage was designed to save the government money. But a Wall Street Journal investigation found that private insurers used the program to generate extra payments through questionable diagnoses. The investigation uncovered instances of potentially deadly illnesses like AIDS, where patients received no follow-up care, as well as diagnoses that were medically impossible. This happened in part when insurers sent nurse practitioners into Medicare Advantage recipients’ homes. Jessica Mendoza discusses the investigation with WSJ’s Christopher Weaver as well as a nurse who participated in the program. Further Listening: -A Life-or-Death Insurance Denial -Even Doctors Are Frustrated With Health Insurance Sign up for WSJ’s free What’s News newsletter. Learn more about your ad choices. Visit megaphone.fm/adchoices
Chapter 1: What is Medicare Advantage and how does it work?
Medicare is America's government-run health care plan. It provides care for anyone 65 and over and some people with disabilities. But what a lot of people may not realize is that a majority of those on Medicare get it through a program called Medicare Advantage.
Yeah, there's more than 60 million people in Medicare, and more than half of those are in Medicare Advantage at this point.
Chapter 2: Why is Medicare Advantage financially significant?
And the thing about Medicare Advantage is that the plans are paid for by the government but managed by private insurance companies.
Medicare Advantage is sort of dominated by these huge insurance companies like United Health Group, Humana, Aetna, and Elevens.
And that's really why we called the series at some level Medicare Inc. Because people think, oh, this is a government program. But it's also a huge, huge, huge business for some of the biggest companies in America.
I'm Chris Weaver.
I'm Ana Wildey-Matthews.
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Chapter 3: What questionable practices are insurers using to profit?
I'm an investigative reporter at The Wall Street Journal.
And I cover health insurance for The Wall Street Journal.
My colleagues Ana and Chris have been investigating the Medicare Advantage program for over a year. So when you and the team looked into the program, what did you find?
Chapter 4: How much money are insurers making from Medicare?
What we found was that Medicare Advantage insurers were basically gaming the system to get paid billions of dollars more and at the same time creating barriers to accessing care.
Over the next two episodes, we'll lay out some of what the journal's investigative reporting team found. Today is about how insurers use questionable practices to profit off of the Medicare system.
In total, what we determined was that Medicare Advantage insurers over a three-year period had got paid $50 billion for diagnoses that they alone added to patients' records. And what astounded me was basically the magnitude and just the total amount of dollars that they were getting from sort of chasing that incentive to make people be sicker on paper.
Welcome to The Journal, our show about money, business, and power. I'm Jessica Mendoza. It's Friday, June 6th. This is Medicare, Inc. Part 1. How private insurers pocketed billions from Medicare. So, Ana, Chris, why did you guys want to look into Medicare Advantage in the first place?
Medicare Advantage cost the federal government more than $460 billion last year. That's a lot of money.
Yeah, that's right. So we decided to dip into this area, which is just a huge portion of the federal budget, so we could see how these giant insurers were operating, what kind of care they were providing, and how much they were getting paid.
In 2023, the investigations team got their hands on Medicare data that goes back about a decade. The information included things like service charges and other records.
Once you sort of have the data in your hands, that's just really only the beginning of the process. Nothing is simple in this program. Nothing is simple about how the insurers are paid. Nothing is really simple about what they do.
So we paired that with extensive interviews of doctors, medical providers, patients, and other people who interact with the system.
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Chapter 5: What did the investigative team uncover about diagnoses?
And what do the health insurance companies have to say about your reporting?
Insurers have defended their practices. They've argued that some of their practices lead to diagnosing patients with serious conditions sooner so they can get the treatment that they need. They argue that their practices lead to better outcomes for patients and end up costing beneficiaries less than traditional Medicare.
Last year, the team published a series of stories based on the data and their reporting. One of those stories caught the eye of a nurse practitioner, and what she read really resonated with her.
All of the things that I'd been feeling and dealing with over the past seven years were sitting there in front of me on a piece of paper, which is why I wrote to Chris and said, you are spot on. I'm Kristen Bell, and I'm from Maine. I'm a nurse practitioner, and I worked for UnitedHealthcare for seven and a half years. You have the same name as the actress. Does that ever come up?
Yeah.
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Chapter 6: What role do nurse practitioners play in Medicare Advantage?
So my patients would always be like, you're not the Kristen Bell. And I'd be like, yeah, sorry. Here I thought. Yeah, exactly. I was going to have you sign my Frozen poster or whatever.
Kristen started working for UnitedHealth in 2017. She'd visit patients at their homes as part of a program called House Calls. It's available to people who are signed up for the company's Medicare Advantage plans. The idea behind the program, according to UnitedHealth, is to help improve care. For instance, by catching diseases early, especially if it's something a doctor might have missed.
The nurse practitioner visits usually took about an hour, and Kristen says she saw around four patients a day. She says the work felt meaningful.
I liked the customer service aspect of it. You know, the reason that it was good is because the people didn't have primary care provider or intermittent primary care, especially in the rural areas. The information that we were able to glean was really helpful. And I can't tell you how many times I would go over medications with people and they'd be missing something or they'd be taking it wrong.
UnitedHealth told us that it sends home visit findings to primary care doctors and that the visits are not intended to replace appointments with them. As part of her visits, Kristen did a lot of testing on her patients. What were you trying to assess with each patient?
I was trying to assess... where they needed help. So, for example, we were doing urine test strips, and that gave me a lot of information about how somebody was doing. Oh, you're dehydrated. Oh, you have kidney disease. Oh, you have glucose in your urine. I'm going to call your doctor. You know, that kind of stuff.
Were you being directed to do anything specific, these visits by your employer or your manager?
Well, it didn't seem so at first.
After she'd been with house calls for a little while, Kristen noticed some things that made her pause. Like when she entered a patient's information into her laptop or tablet, she says the UnitedHealth software would automatically start suggesting diagnoses based on what she put in.
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Chapter 7: How are patients affected by insurers' practices?
But what you really need to work on is, you know, the testing that we're trying to deliver to the patients. And I said, look, you know, if somebody is asymptomatic. You know, you don't test somebody for everything if they come into the hospital. You test them for what they're having difficulties with. She said to me, Kristen, we're not billing for any of this. Just do the testing. Just do it.
And I was like, okay.
After working at the House Calls program for about a year, Kristen told us that she eventually began doing the tests she was asked to do. And after that, she got a raise.
So that's when I was like, ah, that's kind of sketchy. You know, there's something going on here.
UnitedHealth told us that their nurse practitioners are not, quote, Chris looked at a three-year period where Medicare Advantage insurers sent out nurse practitioners like Kristen to run tests and add diagnoses to patient records, including diagnoses of the kinds of conditions that trigger those extra payments. The extra payments added up to about $15 billion during that time.
And some of those diagnoses weren't even real. That's next. Chris and Ana found that diagnoses weren't just showing up on Medicare Advantage patient records after home visits. They were also on records after patients went to see doctors or hospitals. The team found that over a three-year period, all of these additional diagnoses added up to $50 billion in federal payments to the insurers.
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Chapter 8: What are the implications of testing and diagnosis suggestions?
These are conditions that no doctor or hospital treated, and that insurers basically went behind the scenes to add or dispatch nurses to patients' houses to sort of work them over, do a bunch of tests, that kind of thing, but for which they were getting no care. And it was astounding, and UnitedHealth, more than any other insurer, engaged in those practices.
The biggest Medicare Advantage provider, UnitedHealth, told us that the added payments help cover medical care and lower premiums and provide other benefits for members. It also says that chart reviews reflect diagnoses made by patients' doctors. According to the journal's reporting, some of the diagnoses that insurers added to patient records were demonstrably false.
One condition that they looked into was diabetic cataracts. Cataracts, which is when eyes cloud over, are common in the elderly. So is diabetes. But there's another, rarer condition called diabetic cataracts, which is when high blood sugar levels cause that cloudy vision. And a diagnosis of diabetic cataracts was tied to thousands of dollars in extra payments, whereas regular cataracts weren't.
According to the data seen by the journal team, UnitedHealth Medicare Advantage members were about 15 times as likely to have a diagnosis of diabetic cataracts compared to the average patient in traditional Medicare. It was this unusual condition that Kristen, the nurse practitioner with House Calls, says she was encouraged to put down on patient charts.
So for example, if somebody has diabetes and I look in their eyes and I see cataracts, I would put cataracts as a diagnosis, but then they would throw it back at me and say, no, no, no, no, it's diabetes with diabetic cataracts, even though I didn't know if the diabetes caused the cataracts. Well, we know that the person has diabetes and just kind of do it.
Eye doctors interviewed by the journal team said it was unlikely that such a large share of UnitedHealth patients could have this relatively rare disease. Chris also saw patterns in the data that implied some of the patients who were getting diagnosed with diabetic cataracts didn't have the condition at all.
For instance, thousands of patients who received the diagnosis had no record of ever being treated for diabetes, while other patients had already had their cataracts treated.
They had already had the lenses of both eyes surgically removed and replaced during routine cataract surgeries. And it's literally impossible to get cataracts again after you've had cataract surgery in both eyes.
UnitedHealth told us they asked their clinicians to use their medical judgment in diagnosing. The company also said it complies with guidance from the Department of Health and Human Services. Now remember, the way Medicare Advantage works is that insurers get paid more by the government for certain diagnoses.
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