Kaiser Permanente affiliates have agreed to pay $556 million to resolve allegations of Medicare fraud, according to federal prosecutors. This settlement, announced recently, comes after more than four years following a legal claim filed by the U.S. Department of Justice in San Francisco. The case consolidated various allegations from six whistleblower complaints.
The entities involved in the settlement include notable affiliates such as the Kaiser Foundation Health Plan, Kaiser Foundation Health Plan of Colorado, The Permanente Medical Group, Southern California Permanente Medical Group, and Colorado Permanente Medical Group P.C. Headquartered in Oakland, California, Kaiser is recognized as one of the largest nonprofit healthcare plans in the U.S., serving over 12 million members through numerous medical centers.
The lawsuit accused Kaiser affiliates of exploiting the Medicare Advantage Plan system, also referred to as the Medicare Part C program, which allows beneficiaries to enroll in managed care insurance plans. Prosecutors argued that the company pressured physicians to revise medical records, often long after initial patient consultations. This practice allegedly involved adding more serious diagnoses, which would lead to increased reimbursement rates for the plan.
Assistant Attorney General Brett A. Shumate emphasized the expectations for honesty and accuracy in the Medicare Advantage program, stating, “More than half of our nation’s Medicare beneficiaries are enrolled in Medicare Advantage plans.”
Despite the settlement, Kaiser stated there is no admission of wrongdoing or liability. The organization indicated that it opted for this resolution to sidestep the potential uncertainties and costs associated with a trial. In its statement, Kaiser pointed out that numerous significant health plans have encountered similar scrutiny regarding Medicare Advantage risk adjustment practices. The company framed this situation not as a reflection of the quality of care provided to members, but rather as a dispute over the interpretation of documentation requirements within the Medicare risk adjustment program.
