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Home Visits Rake In Big Bucks

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Center for Public Integrity
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Coleman Consulting, a Florida health care billing expert, says doctors often document a diagnosis of cancer after it has been treated or is no longer active. Doing so improperly inflates a Medicare Advantage patient’s “risk score” and triggers an overpayment.

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Third of three parts.

Some of the senior citizens who called Arizona insurance agent Denise Early wondered why their Medicare Advantage health plans were eager to send a doctor to visit them at home.

A few worried that the offer might be a scam. After all, they asked, how many doctors make house calls these days?

More than people might think. Home visits have risen sharply at many private Medicare health plans, which treat close to 16 million elderly and disabled people under contracts with the federal government.

The health plans tout the voluntary, free annual physicals as a major new benefit that can help selected members stay fit and in their homes as long as possible. While the doctors and nurses don’t offer any treatment during their visit, they report their exam findings to the patient’s primary care physician.

Yet there’s more to this spurt in home visits than the appearance of enhanced elder care. The house calls can be money makers for health plans when they help document medical problems — from complications of diabetes to a history of heart trouble that’s flared up.

Health plans can profit because Medicare pays them higher rates for sicker patients using a billing formula known as a “risk score.” So when a home visit unearths a medical condition, as it often does, health plans may be able to raise a person’s risk score and collect thousands of dollars in added Medicare revenue over a year — even if they don’t incur any added expenses caring for that person. That’s been allowed under the billing rules.

The home visits are the most visible segment of a burgeoning medical information and data analysis industry that is thriving behind the scenes, in some cases backed by formidable venture capital and other investment groups, including Google Ventures.

The cottage industry is flourishing as federal officials struggle to prevent Medicare Advantage plans from overcharging the government by billions of dollars every year, a Center for Public Integrity investigation has found.

Medicare made nearly $70 billion in “improper” payments to Medicare Advantage plans from 2008 through 2013, mostly overbillings based on inflated risk scores, according to government estimates.

(For more details, see Home Is Where the Money Is for Medicare Advantage Plans).