Government Enforcement and Review of Managed Medicare Programs: A Glimpse of Historical Practice and Forthcoming Trends

Abstract

When President Biden announced in December 2020 that he intended to nominate California Attorney General Xavier Becerra to head the Department of Health and Human Services (HHS), the appointment raised eyebrows in certain policy circles. Becerra does not fit the typical administrative profile of past HHS heads. In fact, he has no actual experience in health care or public health policy. Rather, his background is primarily rooted in law enforcement. He is best known for being an aggressive litigator who, as Attorney General of California, sought to crack down on public fraud and expand the scope of California’s False Claims Act (FCA). The Biden administration has suggested that Becerra will be expected to bring this prosecutorial outlook to HHS, and work closely with the Department of Justice to “boost health fraud enforcement efforts” (Wheeler, 2020). Whatever the administrative impact of Becerra’s nomination may be, it serves as a clear signal that the continued crackdown on health-care fraud remains one of the few policy areas still enjoying bipartisan support in Washington. Perhaps no area of federal health care is likely to attract more scrutiny or enforcement activity during Becerra’s tenure than Medicare Part C or Medicare Advantage plans. These plans, which pay private health insurers based on a capitated monthly rate per patient, have traditionally been considered less of a fraud risk than their typical fee-forservice counterparts. However, this view seems to be changing, as regulators and private whistleblowers continue to uncover significant fraud within managed-care plans. For instance, in December 2020, Deputy Assistant Attorney General Michael Granston referred to Medicare Part C fraud as an “important priority” for the Department of Justice as it moves forward under a new administration (U.S. Department of Justice, 2020b). Notably, Medicare Advantage fraud was one of only two specific enforcement areas (along with opioid prescription schemes) that Granston singled out in his speech. This article traces the historical oversight of government enforcement in the Medicare Advantage space, and contrasts it with the type of scrutiny typically afforded to more traditional federal health-care programs. The article describes historical enforcement actions brought by the government and outlines some likely trends moving forward.