MEDICARE FRAUD: Feds Crack Down on Alleged HMO Maneuvers

      The federal government moved yesterday to crack down on HMO cherry-picking of Medicare recipients, telling health plans that it is inappropriate to target healthier beneficiaries through practices such as "marketing their plans in health clubs or on the upper floors of buildings with no elevators." American Association of Health Plans President Karen Ignagni said, "We welcome the guidance from the inspector general. But we completely reject the caricature of HMOs as marketing only to healthy individuals," adding that health plans cover numerous seriously ill patients, but are crippled by inadequate federal reimbursements. HHS Inspector General June Gibbs Brown also issued a compliance manual designed to help HMOs "police themselves to prevent violations of Medicare fraud and abuse laws," the New York Times reports. The guidelines said every HMO should "have a written compliance program" and a compliance officer and said HMOs should not use outside marketers or doctors to market their plans. The guidelines will also apply to Medicaid HMOs. The government also said it was "stepping up investigations of HMOs" participating in the Medicare program. The Justice Department's John Bentivoglio said the government was looking into "the selective enrollment of relatively healthy beneficiaries ... and allegations of health plans causing the disenrollment of beneficiaries requiring expensive care." In addition to expressing concern about cherry- picking, the government said it had received reports of HMOs failing to report patient deaths in a timely manner so that they would continue receiving payments and of HMOs incorrectly reporting "that patients are in nursing homes" to get higher reimbursements (Pear, 6/11).