U.S. Accuses Health Insurers and Brokers of Medicare Kickback Scandal

By Nate Raymond

BOSTON (https://smarthealthradar2025.blogspot.com/) – The U.S. Department of Justice has charged three major national health insurance providers with disbursing hundreds of millions of dollars in bribes to brokers who directed patients towards their Medicare Advantage programs.

On Thursday, the Justice Department lodged a lawsuit in a Boston federal court alleging that CVS Health’s Aetna, Elevance Health, and Humana were involved in an extensive kickback scheme with insurance brokers such as eHealth, GoHealth, and SelectQuote between 2016 and 2021.

The lawsuit claims that the firms broke the False Claims Act, a law forbidding the submission of fraudulent claims to the government for reimbursement purposes. The Justice Department is pursuing indeterminate compensation and fines as part of their action.

The parent firm of Aetna, CVS Health, along with Humana, stated separately that they intend to mount a robust defense. Elevance Health expressed confidence that their health plans adhere strictly to federal regulations and guidelines.

GoHealth stated that the lawsuit from the Justice Department contained "numerous misrepresentations and inaccuracies," whereas eHealth described the allegations as "unfounded."

Medicare Advantage programs are provided by private insurance companies which receive a fixed payment from the U.S. government to oversee health care services for seniors seeking additional perks beyond those covered under standard Medicare.

The Justice Department stated that numerous Medicare recipients depend on insurance brokers to assist them in selecting plans that suit their requirements and to manage the intricacies of the Medicare Advantage program.

The Justice Department stated that instead of operating impartially and with the well-being of patients as their priority, the brokers steered Medicare recipients towards insurance plans provided by companies that rewarded them with the highest kickbacks.

These kickbacks were frequently camouflaged under terms like "marketing," "co-op," or "sponsorship" fees, as stated in the complaint.

The lawsuit claims that the brokers motivated their staff and representatives to promote policies due to kickbacks and sometimes declined to offer Medicare Advantage plans from insurance companies that didn’t provide sufficient payments.

The Justice Department stated that Aetna and Humana pledged to withhold incentives from brokers in an attempt to discourage them from enrolling fewer individuals with disabilities, who were considered less lucrative by the insurance companies.

In a statement, U.S. Attorney Leah Foley from Massachusetts described attempts to discourage Medicare recipients with disabilities as "outrageous."

The case initiated on Thursday was originally a whistleblower suit submitted in 2021 under the False Claims Act. This legislation permits whistleblowers to take legal action against corporations with the aim of reclaiming public money dispersed due to fraudulent statements.

These types of cases are originally submitted confidentially as the Justice Department examines the allegations and determines whether to become part of the lawsuit, an action they took earlier this week.

(Nate Raymond reported from Boston; editing by Howard Goller and Leslie Adler)