Federal watchdog accuses Humana, UnitedHealthcare of upcoding

HHS Office of Inspector General audits found HumanaChoice and UnitedHealthcare of Wisconsin submitted high-risk diagnosis codes that were frequently unsupported by medical records, resulting in estimated Medicare Advantage overpayments of about $131 million and $47 million, respectively, for 2020-2021. Auditors reviewed 11 groups of high-risk conditions (including acute stroke, heart attack, embolism and sepsis) and sampled enrollee-years: 178 of 220 HumanaChoice enrollee-years and 183 of 250 UnitedHealthcare of Wisconsin enrollee-years lacked documentation to substantiate the recorded diagnoses. Errors typically involved recording more severe versions of conditions or listing resolved conditions as active. Extrapolating the sample produced the nearly $180 million joint overpayment estimate; the audits recommend refunding the amounts and tightening coding compliance.

The findings underline how Medicare Advantage’s risk-adjusted per-member payments create incentives to upcode and why regulators are expanding audits and policy changes to tie payments to documented encounters. Both insurers disputed the OIG’s methodology, said they will not return funds, and pushed for modernization of audit processes. The audits follow prior probes of major and regional plans that also found improper high-risk coding, reinforcing ongoing federal scrutiny of coding practices and prompting CMS actions to curb unsupported diagnosis submissions.