Humana HQ by nightA federal agency has fined Humana $3.1 million because the company inappropriately delayed or denied coverage to elderly patients.

The Centers for Medicare and Medicaid Services said Humana, a Louisville-based health insurer, took actions that resulted in patients not receiving prescription drugs on time or at all.

The agency also issued a $1 million penalty to Aetna, the Hartford, Conn.-based insurer that wants to buy Humana for $37 billion.

Humana told IL that it has taken corrective action and intends ”to use this opportunity to continue to dedicate ourselves to serving our members as a true health partner.”

In a letter to Humana CEO Bruce Broussard, the CMS Enforcement Group wrote that the company, without seeking CMS approval, limited the quantity of prescription drugs available to Medicare consumers. That meant elderly patients who had legally obtained prescriptions from their physicians went to the pharmacy to pick up medications “and were delayed access to drugs, never received the drugs or incurred increased out-of-pocket costs.”

CMS wrote that Humana also violated rules under Medicare’s appeals and grievance process, including misclassifying denial of claim appeals as “customer service inquiries,” which meant patients were denied appeal rights and their requests were not processed in a timely manner. CMS said those actions likely delayed patients’ access to drugs or prevented them from appealing denials of coverage.

“Humana’s failures in these areas were systemic and resulted in enrollees experiencing inappropriate delays or denials in receiving covered benefits or increased out-of-pocket costs,” CMS wrote.

Humana adds training, upgrades tech

CMS logoHumana spokesman Mark Mathis told IL via email that the company “swiftly and thoroughly addressed the issues raised by the 2015 audit.”

Humana’s corrective actions, which Mathis said were reviewed and accepted by CMS, have included more staff training, “new reporting, tracking and verification procedures; technology upgrades and (patient) outreach campaigns.”

CMS told IL via email that 12 companies that provide Medicare services were issued fines based on audits from last year. The agency said the actions further its goals of transparency of oversight activities and improving industry standards.

The more than 30 civil penalties listed on the CMS website for last year ranged from $30,000 at the low end to Humana’s $3.1 million at the top.

CMS fined Aetna $1 million because nearly 7,000 non-network retail pharmacies were erroneously identified by Aetna as being “in-network,” which may have mislead customers who chose plans on the incorrect information.

CMS said Aetna’s errors led to a “disruption in the marketplace” that included elderly patients trying to obtain prescription drugs at their usual pharmacies only to discover they were no longer in Aetna’s network. That meant the patients had to bear the higher out-of-network cost or leave the pharmacy without their drugs.

CMS also said Aetna’s complaint rates for Medicare prescription drug coverage problems “were five times greater” than the complaint rate for other providers.

“Aetna’s 3,767 complaints accounted for 33 percent of all complaints received by CMS,” the agency said. “Of those complaints, 2,750 (73 percent) were marketing complaints that beneficiaries were misled about in-network pharmacy coverage.”

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Boris Ladwig
Boris Ladwig is a reporter with more than 20 years of experience and has won awards from multiple journalism organizations in Indiana and Kentucky for feature series, news, First Amendment/community affairs, nondeadline news, criminal justice, business and investigative reporting. As part of The (Columbus, Indiana) Republic’s staff, he also won the Kent Cooper award, the top honor given by the Associated Press Managing Editors for the best overall news writing in the state. A graduate of Indiana State University, he is a soccer aficionado (Borussia Dortmund and 1. FC Köln), singer and travel enthusiast who has visited countries on five continents. He speaks fluent German, rudimentary French and bits of Spanish, Italian, Khmer and Mandarin.