Whistleblower Sarah Feinberg, who exposed overbilling practices at consulting firm Booz Allen Hamilton, believes that the Justice Department's settlement of $377 million with the firm is insufficient and that government contractors are still incentivized to defraud the government due to the department's weakness. Feinberg claims that she identified over $250 million of overbilling by Booz Allen, estimating the total scope of the fraud to be at least $500 million. She argues that the settlement represents an interest-free loan rather than a penalty for the fraud. The Justice Department defends the settlement as the largest in history and states that it will continue to be vigilant in similar cases. Booz Allen declined to address Feinberg's new allegations.
The Michigan Public Service Commission (MPSC) is investigating Consumers Energy over complaints of malfunctioning gas meters, possible overbilling, and delays in installation services. Customers have reported malfunctioning meters and abnormally high bills due to estimates made by Consumers Energy. MPSC found that the company was estimating bills for customers with malfunctioning 3G meters, despite being aware of the issue since 2020. The commission is concerned about these discrepancies and will analyze data from Consumers Energy to make recommendations by September 29th.
The Michigan Public Service Commission (MPSC) is investigating Consumers Energy following complaints from customers about malfunctioning natural gas meters, potential overbilling due to estimated meter readings, and delays in new service installations. The MPSC received numerous complaints about malfunctioning meters that were not displaying electricity usage, as well as abnormally high bills due to estimated readings. The commission also noted that Consumers Energy failed to meet Service Quality and Reliability Standards requirements for new service installations. MPSC staff found that the company had been aware of meter malfunctions since 2020 but did not disclose the issue during a waiver request. The MPSC has ordered Consumers Energy to provide explanations and data related to these issues.
UnitedHealth Group reported $91.9 billion in revenue for Q1 2023, with $8 billion in earnings from operations, exceeding analysts' expectations. The company added 655,000 new Medicare Advantage members in the first quarter of the year. UnitedHealth helped lead an aggressive lobbying campaign against new Biden administration rules aimed at limiting Medicare Advantage insurers' ability to overcharge the federal government. The Centers for Medicare and Medicaid Services offered concessions to the industry, agreeing to impose its policy changes over a period of three years instead of all at once and boosting Medicare Advantage payment rates by more than expected. UnitedHealth could reap $900 million in additional profit next year alone thanks to the administration's decision to delay full implementation of the reforms.
The Biden administration has delayed proposed rule changes aimed at cracking down on fraud in the Medicare Advantage program after the insurance industry lobbied against them. The changes involve tweaks to the Medicare Advantage risk-adjustment model, which determines how much the federal government pays insurers to cover patient care. Medicare Advantage plans are notorious for piling on diagnoses to make patients appear sicker than they are to reap larger payments from the federal government. CMS estimates that overpayments to Medicare Advantage totaled $11.4 billion in fiscal year 2022. The Biden administration will phase in the changes over a three-year period, a concession to large insurers that dominate the Medicare Advantage market.
The Biden administration has finalized new rules to reduce overbilling by private Medicare Advantage insurance plans, but softened the approach after intense lobbying by the industry. The changes will be phased in over three years, lessening the immediate effects. Private health plans will still be able to receive payments that Medicare officials do not consider appropriate. The extended timetable could mitigate concerns raised by health plans, doctors, and others that the broad policy change might result in unintended consequences, such as increases in premiums or reductions in benefits for Medicare Advantage beneficiaries.
