A concerning report has been released, stating that Medicare Advantage plans obtained $4.2 billion in extra payments in 2024 by making home visits to elderly beneficiaries who may not have needed them for serious illnesses. Issued by the Office of Inspector General for the Department of Health and Human Services, the report zeroed in on the health risk assessments (HRAs) performed.

These HRAs are usually reserved for diagnosing Medicare enrollees with serious health issues that make it hard for them to leave their home. They are a crucial part of the service, as they also serve as an assessment for higher risk-adjusted payments for Medicare Advantage plans. This means insurance companies would get paid more for their care, and the misuse of these HRAs could negatively impact the overall funds of the program, hence the launched investigation.

The analysis was not favorable to many insurance companies, stating that UnitedHealthcare collected $3.7 billion of risk-adjusted payments last year, making it the biggest benefactor of the practice, followed by Humana, with $1.7 billion, and that many of those assessments were not necessary.

UnitedHealthcare disagreed vehemently with the study deeming it “A misleading, narrow and incomplete view of risk adjustment data is being used to draw inaccurate conclusions about the value of in-home care for America’s most vulnerable seniors in Medicare Advantage.” They continued explaining that the performed home visits, which typically last for 45 to 60 minutes, were provided by “highly trained and board-certified advanced practice clinicians are among the most comprehensive and thorough assessments of a patient’s health and physical environment available in the health care system, helping to identify and drive needed follow-on care for the vast majority of the patients with whom we engage.”

Humana spokesman Kevin Smith further clarified that “HRAs are tools recognized by CMS and help ensure Medicare Advantage members receive better care and health outcomes. These assessments complement and support the care provided by primary care physicians and patients are always referred back to their physicians for follow-up care. We will continue to work closely with CMS and policymakers to improve HRA transparency and accuracy measures and to ensure the highest standards of care and compliance.”

How the report found HRAs affected Medicare Advantage plans

According to the report, 1.7 million people who are enrolled in Medicare Advantage plans received these home visits last year but had no follow-up visits, procedures, tests or supplies for their diagnoses. This indicated to researcher that the visits may have been improper as the beneficiaries received no care for supposed ailments.

“In-home HRAs and HRA-linked chart reviews may be more vulnerable to misuse because these tools are often administered by Medicare Advantage companies or their third-party vendors and not enrollees’ own providers. Diagnoses reported only on these types of records heighten concerns about the validity of the diagnoses or the coordination of care for Medicare Advantage enrollees.”

The cost of these HRAs and HRA-linked chart reviews was $7.5 billion last year, which Medicare paid to private insurance companies. This is because of the disparity in costs between an HRA and a doctor’s visit.

According to the report, each in-home HRA generates about $1,869 in estimated risk-adjusted payments while a doctor’s office or other health care facility visit receives about $365 in payments. The report specifically called out UnitedHealth Group, saying it “stood out from its peers, especially in its use of in-home HRAs and HRA-linked chart reviews to generate risk-adjusted payments.”

But they are not the only ones, of the thousands of Medicare Advantage plan providers, twenty companies were responsible for80% of $7.5 billion in risk-adjusted payments according to the report. How this situation is resolved will mark an important precedent for future diagnoses.

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