A blockbuster lawsuit from the federal Division of Justice alleges that insurers Aetna, Elevance Well being (previously Anthem), and Humana paid “a whole lot of thousands and thousands of {dollars} in kickbacks” to massive insurance coverage brokerages eHealth, GoHealth, and SelectQuote. The funds, created from 2016 to not less than 2021, had been incentives to steer sufferers into the insurer’s Medicare Benefit plans, the lawsuit alleges, whereas discouraging enrollment of probably extra pricey disabled beneficiaries.
All of the insurers and brokers named within the case have denied the allegations and say they may battle them in court docket.
Coverage consultants say the lawsuit, filed Might 1, will add gasoline to long-running concerns about whether or not Medicare enrollees are being inspired to pick the protection that’s greatest for them — or the one which makes probably the most cash for the dealer.
In different Medicare information, The Wall Street Journal final week, citing unnamed sources, reported {that a} separate insurer, UnitedHealth Group, was being investigated by the Justice Division relating to unspecified potential Medicare violations. UnitedHealth pushed again, calling the article “deeply irresponsible” and saying it had not been notified by the DOJ as to any such investigation.
No matter how this consideration shakes out, Medicare Benefit, the non-public sector different to unique Medicare, is more likely to proceed to attract scrutiny as a result of it covers greater than half of these enrolled. However the plans, which regularly include benefits not covered by the standard authorities program, cost taxpayers more per enrollee and have drawn criticism for requiring sufferers to get prior authorization for sure companies, one thing not often required in unique Medicare.
The DOJ lawsuit alleges insurers made massive funds they referred to as “advertising” or “sponsorship” charges to get round guidelines that set caps on dealer commissions. The funds, in accordance with the lawsuit, added incentives — usually greater than $200 per enrollee — for brokers to direct Medicare beneficiaries towards their protection “whatever the high quality or suitability of the insurers’ plans.”
The case joins the DOJ in a beforehand filed whistleblower lawsuit introduced by a then-employee of eHealth, Andrew Shea. The whistleblower’s lawyer, Gregg Shapiro, stated his shopper is grateful the DOJ selected to intervene: “Individuals with Medicare should know that when an insurance coverage agent recommends a plan, that advice is predicated solely on the shopper’s particular person wants and preferences,” Shapiro stated in an emailed assertion.
Whereas inspired that the Trump administration filed the case beneath investigations initiated by the Biden administration, coverage consultants say Congress and insurers have to do extra.
“What we see on this lawsuit highlights the horrible incentives that desperately want Congress to reform,” stated Brian Connell, a vice chairman on the Leukemia & Lymphoma Society, an advocacy group.
