ERIC DEGGANS, HOST:
For the past year, the Wall Street Journal has been investigating how health insurance companies have received billions of dollars in payments from the federal government they may not have been entitled to. Those insurers are part of a program called Medicare Advantage, which originally was meant to deliver health care to senior citizens and disabled patients more efficiently by outsourcing it to private insurers. Investigations reporter Christopher Weaver is part of the Wall Street Journal's investigative team, and he joins us now. Chris, thanks for joining us.
CHRISTOPHER WEAVER: Sure. Thanks for having me.
DEGGANS: So let's start with what is this program, Medicare Advantage, and why the federal government created it in the first place.
WEAVER: The idea behind Medicare Advantage was that instead of paying for each individual service - like, each hip replacement, each doctor's office visit, each lab test - Medicare could pay, like, a lump sum to an insurance company to oversee benefits and that that idea would help rein in the kind of runaway costs of incentivizing doctors and hospitals to just do more stuff. And, of course, the overarching goal was to save money.
DEGGANS: So what went wrong here?
WEAVER: Medicare Advantage, I think, does indeed rein some of that in. But what happened is that instead of paying for services, the government decided that it would essentially pay for diagnoses. It would pay based in part on how sick patients were. And that created two sort of overarching incentives for the insurance companies that effectively run the Medicare Advantage program. One is to diagnose people with more stuff because it increases their payments. And then that creates an incentive to deny services or limit the providers that a person can go to. So the basic idea is that insurers win when patients look sicker and get less health care.
DEGGANS: And so when the insurers get these extra payments for diagnoses, do they also get to bill for, you know, services related to it? I mean, is there a whole constellation of...
WEAVER: So, yeah, the insurers are paying the doctors and hospitals that treat patients. So if somebody's got, you know, heart failure or something like that and they need treatment for that, you know, the insurers are on the hook for that. The insurers are able, though, to add diagnoses, as we've reported, kind of on the back end, for which patients are receiving no treatment at all. And that includes some stuff that's sort of questionable, like patients who have cataracts and diabetes getting diagnosed with complications of diabetes that triggers thousands of dollars or more payments a year, and in some cases even after their cataracts had already been cured by cataract surgery. That happened even with conditions as serious as HIV, where we found thousands of patients who were receiving none of the lifesaving antiretroviral therapies that are recommended for everybody with that virus which causes AIDS. Yet the insurers were getting paid about three grand a year for each diagnosis.
DEGGANS: We reached out to one company that you focused on - UnitedHealth - and they pointed us to statements saying their actions lead to, quote, "better health outcomes," and they were able to find conditions that escape their doctor's notice. Is that possible?
WEAVER: One of the most interesting things about their view of this is that the incentives in Medicare Advantage lead them to find conditions earlier and that they're helping patients by picking up diseases sooner. Our most recent project looked at doctors working directly for United and found that their patients, when they moved from regular Medicare into Medicare Advantage, got, like, 55% sicker on paper in the space of just one year. And when doctors working for UnitedHealth Group treat patients who are in traditional Medicare, they don't do any of that stuff to increase their level of diagnoses. So it begs the question - if diagnosing all this extra stuff helps patients, why aren't they doing it for their patients for whom they don't get extra government payments?
DEGGANS: So, of course, there's been a lot of publicity around a shooting involving UnitedHealth CEO Brian Thompson, where he was killed in New York City last month. And that's led to a lot of public discussion and anger expressed about health care insurers. What do you think that means for companies like UnitedHealth and other insurers when you look at what you've seen in your reporting?
WEAVER: I mean, first of all, let me just say, you know, it was an absolute tragedy. And it's been kind of stunning at times to watch the outpouring of anger that it triggered. I don't think that it had anything to do with Medicare Advantage insurers adding diagnoses, for one thing. I do think that it - you know, that that sort of online, you know, rage reflected a sort of deep-seated, you know, long-standing concern about the way the U.S. health system is organized. And, I mean, just I think it speaks to the reality that access to medical care in this country is simply not always as equitable as I think we would all aspire for it to be.
DEGGANS: I know that it's treacherous sometimes to try and predict what might happen in government, but do you think there will be changes to the Medicare Advantage program or at least official investigations into these particular companies?
WEAVER: So, first of all, there are long-standing whistleblower suits pending against a number of these companies for conduct kind of related to the types of things that we've been reporting on. One big question, I think, is what the new administration will mean for Medicare Advantage insurers. Like, Dr. Mehmet Oz, the presumptive nominee to run the Medicare agency, is thought to be a big believer in Medicare Advantage. But at the same time, the pressure to find places to reduce costs is as high as ever, and I think there may also be a sort of countervailing interest in that. And this is simply a big, giant bucket where there's a lot of opportunity to reduce spending.
DEGGANS: That's Chris Weaver. He's an investigations reporter with the Wall Street Journal. Thank you so much for joining us.
WEAVER: Thanks a lot, Eric.
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