RISE summarizes recent regulatory-related headlines.
2025 Star ratings go up for UnitedHealth, Centene following court challenges
UnitedHealthcare and Centene saw an upgrade in their Medicare Advantage Star ratings for 2025 following a court order that the Centers for Medicare & Medicaid Services (CMS) recalculate UnitedHealthcare’s Star rating over its failure to evaluate a disputed call center call based on the agency’s own guidelines. Modern Healthcare reports that CMS increased the quality ratings for 12 UnitedHealthcare contracts and seven Centene contracts. Two UnitedHealthcare contracts were upgraded from 4.5 to five stars, according to Becker’s Payer Issues. CMS also upgraded ratings for Centene plans although a court has not issued a ruling over its complaint for a disputed secret shopper phone call.
Minnesota AG urges Humana to correct misinformation regarding Medicare Advantage plans
In a letter to health insurer Humana, Inc., Minnesota Attorney General Keith Ellison has asked that the insurer correct alleged misinformation the company shared with consumers about Medicare Advantage.
Ellison said that an article in the Minnesota Star Tribune reports that during the Medicare enrollment period that began October 15, Humana listed certain providers, including Essentia Health, Avera Health, North Memorial Health, and Sanford Health, as being in-network for their Medicare Advantage plans in 2025. However, the providers had previously announced that they will no longer be in-network with Humana’s plans.
This alleged misinformation, if not corrected, could result in Humana customers paying much more for the health care they receive if their preferred provider ends up no longer being in-network, Ellison said. Furthermore, Minnesotans on Medicare only have until December 7 to select their health insurance plans for 2025, and Minnesotans switching between Medicare Advantage plans in early 2025 might experience a gap in coverage.
“It’s my goal to help Minnesotans afford their lives and live with dignity, safety, and respect, and that becomes far more difficult when folks cannot afford the medical care they require,” Ellison said in a statement. “If Humana did indeed share this misinformation, I urge Humana to make all possible haste and take all efforts possible to correct it. It is essential that Minnesotans considering a Medicare Advantage plan have accurate information about what that plan will and will not cover.”
In the letter, he requested Humana take the following actions:
- Explain the extent to which Humana listed out-of-network providers as “in-network” during open enrollment for its 2025 Medicare Advantage plans.
- Identify and describe each step Humana has taken to correct this issue, including what plans, if any, Humana may have to reimburse consumers for care at out-of-network providers through March 2025, for those consumers who signed up for a Humana Medicare Advantage plan based on a misunderstanding of Humana’s in-network coverage.
- Immediately send correspondence to each patient which Humana knows—or should know—used a provider who was in-network in 2024 under a Humana Medicare Advantage plan but will be out-of-network in a 2025 Humana Medicare Advantage plan. Letters should all be sent to all patients who enrolled in a Humana Medicare Advantage plan for the first time in 2025 but identified a provider that will be out-of-network.
- The letter must alert patients to Humana’s error in misidentifying facilities or providers as in-network in 2025, and clearly and conspicuously disclose providers that will be transitioning to out-of-network in 2025, including but not limited to Essentia Health, Avera Health, North Memorial Health, and Sanford Health. The insurer should also provide an accurate list of facilities or providers that will be in-network in 2025 and inform patients of the upcoming Medicare Advantage enrollment period during which they may switch coverage to ensure they are enrolled with an in-network provider for 2025.
CMS finalizes new model for kidney transplants
CMS has finalized a rule that establishes a new, six-year mandatory model to increase access to kidney transplants, improves the quality of care for people seeking kidney transplants, and reduces disparities among individuals who undergo the process to receive a kidney transplant. The Increasing Organ Transplant Access Model’s mandatory participation of transplant hospitals aims to spur innovation nationwide by evenly distributing the model’s effects across the nation while engaging more specialists in value-based care. - Each year, around 130,000 Americans are diagnosed with chronic kidney disease, which accounts for 24 percent of annual Medicare spending, CMS said. Kidney transplantation is the most effective treatment for individuals with chronic kidney disease and end-stage renal disease (ESRD). The new model will help improve the effectiveness of the country’s kidney transplant system, which doesn’t meet the needs of many patients. CMS said on average, 13 Americans die each day while waiting for a life-saving kidney transplant. Despite the significant gap between organ supply and demand, 30 percent of donor kidneys are discarded each year. There are approximately 90,000 people on the kidney transplant waiting list, facing a wait time of three to five years or longer for an offer. However, CMS said only 28,000 organs are procured annually.
- The new model will create a representative national sample of kidney transplant hospitals, aims to tackle long-standing challenges by enhancing the quality of care for patients with ESRD, and boost the number of transplants performed. It will support greater care coordination, improve patient-centeredness in the process of being waitlisted for and receiving a kidney transplant, and provide greater access to kidney transplants.
- The Increasing Organ Transplant Access Model provides participating transplant hospitals a financial incentive to perform more transplants and a disincentive to perform fewer (i.e., a two-sided risk arrangement). Performance will be measured according to the number of transplants (“achievement”), rates of accepting organs offered (“efficiency”), and post-transplant outcomes (“quality”). Based on its final performance score, a participating transplant hospital will either receive a payment from CMS; fall in a neutral zone in which it neither receives nor owes a payment; or, beginning in performance year two, owe a payment back to CMS. These performance-based payments are in addition to the traditional Medicare fee-for-service payment.
The new model will take effect July 1, 2025. For more information, click here for the fact sheet.
DOJ: 4 sentenced in $54.3M Medicare fraud scheme
The Department of Justice announced that four Floridians were sentenced to prison for their role in a $54.3 million health care fraud scheme in which they paid kickbacks and bribes to telemarketers and telemedicine providers to secure orders for medically unnecessary prescriptions that were billed to Medicare.
Luis Lacerda, 37, of West Palm Beach was sentenced to three years and five months in federal prison, Omar Solari 36, of Fort Lauderdale, will serve two years and six months in federal prison, Michael Murphy 38, of Fort Lauderdale to 15 months in federal prison, and Joelson Viveros, 45, Boca Raton) to five years’ probation.
U.S. District Judge Timothy J. Corrigan also ordered Lacerda to forfeit $15,600,333.30 and pay $54,303,526 in restitution; Solari to forfeit $6,341,240.58 and pay $36,246,251 in restitution; Murphy to forfeit $3,650,943.36 and pay $8,374,175 in restitution; and Viveros to forfeit $894,116.45 and pay $3,017,135 in restitution.
Each previously pleaded guilty to their role in a conspiracy in which they owned and operated pharmacies that participated in the Medicare program, including one located in Jacksonville. From approximately 2018 through 2021, they paid kickbacks and bribes to telemarketing companies in exchange for recruiting Medicare beneficiaries to accept prescriptions for various medications–mainly topical creams–which the beneficiaries did not want or need. Some also operated companies that engaged in telemarketing activities to develop beneficiary leads.
The men then paid kickbacks and bribes to telemedicine companies that employed or contracted with physicians who signed the prescriptions. The physicians had no physician-patient relationship with the beneficiaries and typically signed the prescriptions after a cursory telephone conversation with the beneficiary or with no contact at all. After obtaining Medicare beneficiary information and the signed prescriptions, the co-conspirators submitted claims to Medicare for medically unnecessary medications, sometimes through multiple pharmacies they owned and controlled in a practice known as “recycling.” Over the course of the conspiracy, the defendants’ pharmacies were reimbursed more than $54.3 million for medically unnecessary prescriptions by Medicare Part D.
American Health Imaging, Inc, former CEO to pay $5M settlement to resolve kickback allegations
American Health Imaging, Inc. (AHI) and its former founder and CEO, Scott Arant, will pay the United States and the state of Georgia $5,250,000 to resolve allegations that they violated the False Claims Act by providing physicians with meals, tickets to sporting events, and other gifts to induce those physicians to refer diagnostic scans to AHI’s independent diagnostic testing facilities, and entering into above fair market value personal services agreements with referring physicians to encourage those physicians to refer scans to AHI.
“The use of inducements to obtain referrals from medical professionals jeopardizes the integrity of our health care programs,” said U.S. Attorney Ryan K. Buchanan in a statement. “This settlement demonstrates our Office’s commitment to hold accountable providers who ignore Medicare and Medicaid’s strict prohibition against using kickbacks for personal greed.”
The government alleges that, between 2011 and 2019, AHI relied on a variety of inducements–sporting events, fishing trips, happy hours, sponsorships of “open houses” at physician offices, and gifts of alcohol, gas cards, and free scan–to generate referrals for diagnostic scans. Many of the marketing events involved no discernible educational purpose, Examples include tickets to the SEC football championship game, tickets to concerts, monthly dinners with referral sources, and outings to nail salons. The government also claims that AHI entered into personal services agreements with referring physicians that were above fair market value. Under these agreements, physicians were compensated to interpret the scans that they referred to AHI.
The settlement resolves allegations filed by Tanya Benjamin, a former AHI employee, under the qui tam, or whistleblower, provisions of the False Claims Act, which authorizes private parties to sue for false claims on behalf of the United States and share in the recovery. She will receive a share of the settlement.