<p>A federal audit has found that UnitedHealthcare, the largest health insurance company in the U.S. by revenue, likely inflated its Medicare billing claims by at least $46.9 million between 2020 and 2021.</p>
<p>The Medicare compliance review, conducted by the U.S. Department of Health and Human Services’s inspector general’s office, concluded that UnitedHealthcare upcoded various diagnoses during the 2020-21 payment period, including when it billed for strokes, embolisms, and several types of cancers.</p>
<p>Most of the insurer’s medical records analyzed as part of the audit did not support the diagnostic codes that UnitedHealthcare submitted to the Centers for Medicare and Medicaid, according to a 59-page report published on the OIG’s findings.</p>
<p>The audit report comes as UnitedHealthcare’s sister company, Optum, continues to investigate Minnesota’s healthcare programs as the outside firm hired to assess the state’s Medicaid reimbursement system for fraud vulnerabilities following a proliferation of billing schemes that stole millions of federal dollars from its social services.</p>
<p>Optum and UnitedHealthcare are both Minnesota-based subsidiaries of UnitedHealth Group and are headquartered about 12 miles southwest of downtown Minneapolis. The healthcare conglomerate’s data analytics arm, Optum State Government Solutions, is the division of UnitedHealth Group that Minnesota is contracting with to analyze years of Medicaid claims.</p>
<p>Compliance review officers at HHS estimated that UnitedHealthcare owes the federal government roughly $47 million in overpayments received through the Medicare Advantage program.</p>
<p>Under the Medicare Advantage program, CMS makes advance monthly payments to insurers for the anticipated costs of providing healthcare coverage to eligible seniors. Using a system of risk-factor calculations, the predicted payouts are based in part on the health conditions of the patients enrolled. To determine the covered beneficiaries’ health status, CMS relies on insurance companies to collect diagnostic codes from medical providers and submit the diagnoses to CMS.</p>
<p>Federal auditors examined specific diagnostic categories at higher risk of upcoding and found that UnitedHealthcare overstated diagnostic codes for acute stroke, sepsis, myocardial infarction, embolism, and cancer, among other illnesses.</p>
<p>For instance, regarding a sampling of patients who previously had lung cancer, breast cancer, colon cancer, prostate cancer, and ovarian cancer, their medical records allegedly did not justify a cancer diagnosis at the time of treatment. The auditors identified supporting documentation for a less severe diagnosis, and UnitedHealthcare accordingly “should not have received an increased payment.”</p>
<p>UnitedHealthcare disputed the audit’s findings, stating that the methodology behind the federal government’s claims-validation process is “fundamentally flawed.”</p>
<p>“While we welcome government reviews of our Medicare Advantage program, we disagree with the current approach to validating data,” UnitedHealthcare told the Washington Examiner. “The flawed methodology in this report from the Office of the Inspector General is further evidence that modernization is needed, and we remain committed to working with both CMS and the OIG to improve the program and their audit processes.”</p>
<p>UnitedHealthcare stated the OIG audit focused on “high-risk” diagnostic codes that federal investigators flagged as more likely to show discrepancies, rather than selecting a representative sample that reflects every type of medical claim.</p>
<p>Thus, the audit’s results cannot be considered a reliable depiction of overall payment accuracy, UnitedHealthcare argued, calling the sample size of 250 cases “deliberately one-sided” and too small to extrapolate from.</p>
<p>In 183 instances, constituting a 73.2% noncompliance rate, the OIG found that alleged improper coding amounted to $722,280 worth of overpayments. Based on these case studies, the auditors then calculated the $46.9 million in unjustified payments within that same time frame.</p>
<p>UnitedHealthcare leadership requested that OIG withdraw all its reform recommendations in written comments responding to a draft of the audit report.</p>
<p>“United’s robust compliance practices have proven effective, as demonstrated by its performance in the RADV audits for Payment Years 2011-2013, which recently found that United’s diagnoses are among the most accurate in the industry,” wrote Robert Hunter, chief executive officer of UnitedHealthcare’s government programs.</p>
<p>In a letter addressed to the HHS inspector general’s office, Hunter said, “The OIG’s recommendation for enhanced compliance procedures exceeds the auditing and monitoring that CMS requires of Medicare Advantage plans.”</p>
<p>“[W]e do not agree that United is broadly obligated to perform additional reviews,” Hunter wrote, saying that CMS regulations do not require UnitedHealthcare to conduct such self-audits.</p>
<p>The audit was part of a series of audits OIG is conducting across insurance companies that offer Medicare Advantage plans. This week, the OIG also released a report on its audit of HumanaChoice, finding that HumanaChoice should refund the federal government $130.9 million for similar overpayments.</p>
<p>Audit recommendations are not final determinations. Officials at CMS will determine if overpayments exist and whether to recoup funds in an audit resolution process.</p>
<p>UnitedHealthcare, one of the largest insurers in Medicare Advantage, has faced federal scrutiny before concerning its Medicare billing practices. In 2024, an OIG report said UnitedHealth Group led its peers in “questionable” use of health-risk assessments to generate payments.</p>
<p>Last year, federal prosecutors in the Justice Department’s fraud-fighting unit were reportedly investigating UnitedHealth Group’s Medicare business, suspecting that it deployed doctors to make diagnoses that boost payments.</p>