Kaiser Foundation Health Plan of Washington, formerly known as Group Health Cooperative (GHC), agreed to pay $6,375,000 to resolve allegations that it submitted invalid diagnoses to Medicare for Medicare Advantage beneficiaries and received inflated payments from Medicare as a result, the Justice Department announced today. Kaiser Foundation Health Plan is headquartered in Oakland, California. Under the Medicare Advantage program, also known as Medicare Part C, Medicare beneficiaries may opt to obtain healthcare coverage through private insurance plans that are owned and operated by private insurers known as Medicare Advantage Organizations (MAOs). Medicare pays MAOs a fixed, monthly amount to provide healthcare coverage to Medicare beneficiaries who enroll in their plans. Medicare adjusts these monthly payments to reflect the health status of each beneficiary. In general, Medicare pays MAOs more for sicker beneficiaries and less for healthier ones. MAOs report beneficiary diagnoses and other information to Medicare on an annual basis and Medicare uses this information to adjust the payments that the MAO receives from Medicare. The settlement resolves allegations that GHC knowingly submitted diagnoses that were not supported by the beneficiaries’ medical records to inflate the payments that it received from Medicare.
