Kaiser Health News sues CMS, HHS over denial of access to Medicare Advantage audit info

The nonprofit news service alleges the federal government violated the Freedom of Information Act by refusing to disclose documents reflecting risk adjustment validation data.

Kaiser Health News (KHN) has filed a federal lawsuit against the Centers for Medicare & Medicaid Services (CMS) and the U.S. Department of Health and Human Services (HHS) alleging that the two agencies violated the Freedom of Information Act (FOIA) by failing to respond to a request for Medicare Advantage (MA) risk adjustment validation data reviews.

The suit was filed last Sept. 26 in the United States District Court for the Northern District of California.

The records being sought by KHN are related to as many as 90 government audits of services provided from 2011 to 2013, which purportedly reveal hundreds of millions of dollars of overcharges by MA plans.

“This action is about accountability for hundreds of millions of public dollars misspent,” KHN Editor-in-Chief Elisabeth Rosenthal said in a statement posted to KHN’s website. “The public deserves details about the overpayments, since many of these private companies are presumably still providing services to patients, and we need to make sure it can’t happen again.”

KHN said that its reporters filed an FOIA request on July 3, 2019, asking CMS for the risk adjustment validation data, to include audit spreadsheets, payment error calculations, and other records. But according to the lawsuit, CMS never responded.

While Medicare publicly discloses audits of other medical businesses, MA insurers “are being treated differently,” according to the suit. “These audits are improperly being withheld by CMS, even though CMS estimates that these audits have identified some $650 million in improper charges,” the suit reads.

KHN also reported this week that earlier this month, U.S. Sen. Sherrod Brown (D-Ohio) and five other senators sent a letter to CMS Administrator Seema Verma asking her to investigate Medicare Advantage overbilling.

“In many cases, CMS has known for years about the tendency for some MA plans to overbill the government, yet, despite this, CMS has taken little to no action to course-correct,” Brown wrote. “It is critical that CMS act immediately to recoup these overpayments and prevent future overbilling by MA plans.”

KHN also noted that its FOIA lawsuit is the second by a media organization filed to compel CMS to disclose such audit findings, following legal action in 2014 by the Center for Public Integrity. In that case, the Center sued CMS and won a court order forcing the release of risk adjustment validation data audits for the first time.

The audits reportedly showed that 35 of 37 plans had been overpaid, in some cases by as much as $10,000 per patient in a year.