A recent ruling by a federal judge has overturned a Biden-era rule that aimed to increase audits of private Medicare plans, potentially saving insurers billions of dollars in overpayments. The decision, made by Judge Reed O’Connor of the Northern District of Texas, came in response to a lawsuit filed by health insurer Humana challenging the Centers for Medicare and Medicaid Services’ final rule from 2023.
The rule in question, known as “risk adjustment data verification” (RADV), required Medicare Advantage plans to undergo audits to ensure that the diagnoses they reported for their members were accurately supported in medical records. This process was intended to prevent insurers from inflating their members’ risk profiles in order to receive higher payments from the government.
The Trump administration had planned to expand on the 2023 RADV rule by implementing more rigorous audits of Medicare Advantage plans, including hiring additional coders and utilizing technology to analyze insurers’ data more efficiently. The goal was to address the issue of overpayments, which costs the government billions of dollars each year.
However, the recent court ruling has put a halt to these plans, throwing a wrench in the government’s efforts to crack down on overpayments to Medicare Advantage plans. The decision has significant implications for both insurers and the government, as it could potentially save insurers billions of dollars in overpayments while impacting the government’s efforts to control healthcare spending.
Overall, the ruling represents a significant development in the ongoing debate over Medicare Advantage payments and underscores the complex challenges facing the healthcare system. It remains to be seen how the government will respond to the court’s decision and what implications it will have for the future of Medicare Advantage audits.
