Federal officials spent years locked in a secret legal battle with UnitedHealth Group, the nation’s biggest Medicare Advantage insurer, after a government audit detected widespread overbilling at one of the company’s health plans, newly released records show.
The audit, completed in 2012, found that Medicare had paid too much for nearly half of a sample of patients enrolled at PacifiCare of Washington State, a subsidiary of UnitedHealth Group. The heavily redacted audit was part of a cache of documents recently released to the Center for Public Integrity through a court order in a Freedom of Information Act lawsuit.
Matt Burns, a UnitedHealth spokesman, declined comment. However, during more than three years of confidential — and previously undisclosed — negotiations, the insurer argued the audit was unfair and the results were flat out wrong.
These audits are called Risk Adjustment Data Validation, or RADV. They test the accuracy of a billing tool called a “risk score.” Medicare uses risk scores to pay health plans higher rates for sicker people and less for those with few medical needs. But federal officials concede that some health plans may overstate how sick their patients are, a practice known as “upcoding,” that wastes billions of tax dollars every year. The RADV audits are designed to recover any overcharges.