Ministry of Justice litigation insurance company, broker suspected of rebates
The U.S. Department of Justice (DOJ) filed a complaint Thursday against three Medicare Advantage insurers and three insurance broker groups alleging that insurers paid illegal kickbacks to brokers to increase program enrollment.
The insurers designated in the complaint are Aetna, Elevance Health and Humana, while the brokers are EHEADH, GOHEADE and SELECTQUOTE. The Justice Department claims that insurance companies paid brokers hundreds of millions of dollars in kickbacks from 2016 to at least 2021. Rebates are illegal payments in exchange for favorable treatment. The complaint was targeted in the U.S. District Court under the False Claims Act.
To choose a Medicare Advantage program, many seniors rely on brokers to help find the options that best meet their needs. However, the Justice Department argues that some brokers may guide older people to adopt plans for insurance companies that offer the biggest rebates, rather than the best defender for individuals.
The complaint states that the defendant brokers motivate employees and agents to sell plans to insurers with the most rebates, and they sometimes refuse to sell MA plans to insurers, and the insurers do not have enough money after they recovered.
“Healthcare companies that try to profit from kickbacks will be responsible,” said Michael Granston, deputy assistant attorney general for the Department of Justice’s civil division, in a statement. “We are committed to developing illegal practices by Medicare Advantage insurance companies and insurance brokers that undermine the interests of patients on federal healthcare programs and their services.”
The Justice Department also claims that Aetna and Humans work with defendant brokers to discriminate against Medicare beneficiaries with disabilities, who believe they are profitable. The complaint said they did this by threatening to withhold rebates so that brokers would reduce disability beneficiaries’ participation in these programs and direct them to other programs.
American attorney Leah B. “The alleged efforts to expel beneficiaries, especially because their disability may make them less profitable to health insurance companies or even more unreasonable.”
Several defendants withdrew their complaints. A spokesman for Elevance Health said the company believes its health plans have “complied and continue to comply with” and adhered to the rules and guidelines outlined by the Centers of Medicare and Medicaid Services (CMS) and will fight the allegations.
Similarly, an Aetna spokesman said the insurer designed and executed its marketing plan and compensated brokers for compliance with the CMS.
“We remain committed to providing high-quality insurance products to a wide range of individual needs and strive to ensure that everyone can meet their needs. We object to these allegations and intend to do our best to defend ourselves. Phillip Blando, a spokesman for Aetna.
Humana's spokesman also said the insurance company disagreed with the allegations and would defend itself in legal proceedings. Humana's “highest priority remains the opportunity to ensure our members have excellent health insurance and access to care,” the spokesperson added.
Brokers also objected to the allegations, and a SelectQuote spokesman said the company “has always been a highly converged organization that complies with all applicable rules and regulations. We place the best interests of our clients at the forefront of the work we do and see these claims as unfounded.”
EHealth noted in a statement that the company has fully cooperated with the Justice Department since receiving the investigation in 2022.
“EHealth firmly believes that these claims are invincible and remains committed to vigorously defending itself,” the company said.
GoHealth did not immediately return requests for comment.
Photo: Gearstd, Getty Images
