Kaiser Permanente settles for $556 million over Medicare Advantage billing claims

Kaiser Permanente agreed to pay $556 million to the federal government and two whistle-blowers to settle civil lawsuits that accused the health system of fraudulent overbilling through its Medicare Advantage plans. The suits, filed more than a dozen years ago, alleged that Kaiser overstated how sick its patients were to obtain higher government payments.

According to the Justice Department, executives routinely pressured doctors to add thousands of diagnoses, sometimes weeks or months after treatment, and tied doctor and facility bonuses to adding diagnoses; the government estimated Kaiser received about $1 billion from 2009 to 2018 from additional diagnoses, including roughly 100,000 findings of aortic atherosclerosis.

The settlement, which the Justice Department said is a record dollar figure in a Medicare Advantage case, drew sharp statements about oversight. "Medicare Advantage is a vital program that must serve patients’ needs, not corporate profits," said Craig H. Missakian, the U.S. attorney for the Northern District of California.

Kaiser said it did not admit wrongdoing and settled to avoid the cost and uncertainty of prolonged litigation, calling the dispute "about how to interpret the Medicare risk adjustment program’s documentation requirements." The Justice Department joined the lawsuits in 2021. One whistle-blower, Dr.

Key Topics

Health, Kaiser Permanente, Medicare Advantage, Justice Department, James Taylor, Aortic Atherosclerosis