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Multimillion Dollar Settlement Reached in Department of Justice Case Against SNF Organization for Disenrolling Residents from Their Medicare Advantage Plans

The U.S. Department of Justice (DOJ) secured an agreement with a nursing facility company that has resulted in a $7.85 million dollar settlement. The DOJ case notes examples of facility staff disenrolling residents from Medicare Advantage (MA) plans back to Original Medicare without the resident's consent. As part of the settlement agreement the nursing facility organization was required to admit to the specifics of the violations. 
 
So what are the implications for nursing facility providers? On two separate occasions CMS has issued guidance and reminders to nursing facility providers that interfering with resident choice of healthcare coverage through disenrollment of residents from MA plans is a violation of resident rights and Federal Law. The initial guidance reminder was released in 2015 in response to various beneficiary and state accusations that nursing facilities were disenrolling residents from Medicare Advantage plans participating in the Financial Alignment Demonstration. They reissued guidance in 2021 outlining what policies and procedures providers should have in place when engaging in conversations with residents around changes to health care coverage. https://www.cms.gov/files/document/ltcfdisenrollmentmemo.pdf.
 
AHCA/NCAL reminds nursing facilities to: 1) develop internal MA plan policies and procedures which incorporate the guidelines outlined in the 2021 memo (link above); and 2) educate staff on acceptable and unacceptable practices related to discussions and changes around resident health care coverage to avoid violations of these regulations.
 
Staff contact: awesthoff@mehca.org

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