Four U.S. Senators, two Republicans and two Democrats, wrote to Dr. Mehmet Oz, Administrator of the Centers for Medicare and Medicaid Services (CMS), urging a crack-down on the practice of upcoding in Medicare Advantage (MA) plans. The Senators also called on Congress to enact S.1105, the No Upcode Act.

In their March 30 letter, Sens. Bill Cassidy (R-LA)—who is chairman of the Senate committee of jurisdiction (Health, Education, Labor and Pensions, or HELP) over the issue, Jeff Merkley (D-OR), Tina Smith (D-MN), and Roger Marshall (R-KS) said that upcoding vastly increases the amount of taxpayer money spent on MA. Upcoding, generally, is the practice of diagnosing MA patients with more expensive maladies/injuries than they actually have. This results in higher reimbursements to the providers, and higher costs to Medicare.

Upcoding has been the subject of recent hearings into the working of MA plans. Well over half of all Medicare beneficiaries have selected an MA plan for their coverage. Lawmakers, reeling from this year’s huge health insurance premium increases, have upped their oversight of all health care issues, including MA plans. Upcoding, described by some as no less than insurance fraud, has been in the spotlight as a result.

In their letter, the Senators tell the CMS Administrator Oz that in light of more data on the practice of upcoding, his department, along with its parent agency, the Department of Health and Human Services (HHS), should take more steps to crack down on the practice.

Prospects: The bipartisan No Upcode Act could be included in the upcoming all-GOP reconciliation bill, depending on whether it can be crafted to comply with the Byrd Rule that requires any provision in a reconciliation bill to principally impact revenue rather than policy.

The bill would ban the practice of upcoding by incorporating more patient health data and aligning payments closer to the rate of traditional Medicare payment rates.

NAIFA Staff Contact: Mike Hedge – Senior Director – Government Relations, at mhedge@naifa.org