Justice Department sues insurers for alleged Medicare kickbacks and enrollment fraud.
The federal government is taking on three major health insurers, saying they broke the law by handing out large sums of money to insurance brokers to push their private Medicare plans. The lawsuit, filed in Massachusetts, names Aetna, Elevance (formerly Anthem), and Humana as companies that took part in these alleged schemes involving Medicare kickbacks. According to the complaint, these insurers worked with brokerages like eHealth, GoHealth, and SelectQuote in a way that the government says crossed legal lines. All of this allegedly took place over several years, beginning as far back as 2016 and continuing through at least 2021.
The Justice Department says the companies struck deals where brokers were paid more if they enrolled seniors in certain plans over others. These payments, according to the lawsuit, weren’t just big — they were designed to push brokers to act in the interest of insurers instead of the people they were supposed to help. Officials say this created a setup where seniors were nudged into plans that may not have been the best fit for them. The government claims the companies knew the arrangements were wrong but did it anyway because it brought in more customers and boosted profits.
There’s also a part of the complaint that accuses two of the insurers, Aetna and Humana, of trying to avoid enrolling people with disabilities. Since these individuals often need more care, the idea was that they would be more expensive for insurers. This is a problem because the rules say Medicare Advantage plans must accept any eligible senior in their area — regardless of their health status. If true, this could mean that some of the most vulnerable people weren’t given a fair shot at getting the coverage they needed.
The Justice Department said it is trying to put a stop to these kinds of practices and make sure taxpayer money isn’t being misused. They want the companies to pay back the funds involved and face additional penalties under the False Claims Act. This law is used when someone is accused of cheating the government or misusing federal money.
In response, the companies named in the suit are standing their ground. Aetna, which is part of CVS Health, said it’s still going over the complaint but disagrees with the claims and plans to fight back in court. Humana also pushed back, saying it would defend itself and arguing the accusations aren’t true. GoHealth expressed disappointment that the government decided to step in years after the original whistleblower complaint was filed and said it won’t let the lawsuit distract it from serving seniors. The other brokerages named — eHealth and SelectQuote — didn’t respond right away.
This case shines a light on the behind-the-scenes business of Medicare Advantage, a fast-growing part of the healthcare system. More than half of seniors in the U.S. are now enrolled in one of these private plans. While they often promise extra benefits compared to traditional Medicare, there have been growing concerns about how they’re marketed and whether patients are getting what they’re promised.
In recent years, ads for Medicare Advantage plans have popped up all over TV and the internet, often with actors portraying friendly agents offering to help seniors find better coverage. But critics say the industry’s focus on profits can sometimes leave older adults confused or even misled about what they’re signing up for.
The Justice Department is now stepping in to figure out if these companies went too far. If the court agrees, the outcome could send a message to the rest of the industry — one that says pushing sales over people’s health won’t be tolerated, and those who break the rules could face serious consequences. For now, the companies are preparing for a long legal fight, while the government pushes for accountability on behalf of the seniors affected.
Sources:
DOJ alleges Medicare Advantage plans paid illegal kickbacks
Justice Department Sues Big Medicare Insurers Alleging Kickbacks
Medicare Advantage insurers, brokers sued by U.S. over alleged kickbacks
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