Audit: Feds overpaid Excellus more than $41M to administer Medicare Advantage health plans

Syracuse, N.Y. -- The federal government overpaidExcellus more than $41 million in 2007 to provide health insurance for customers enrolled in Medicare Advantage plans, according to an audit by the Office of Inspector General in the U.S. Department of Health and Human Services.

The audit report, posted on the Inspector General’swebsite, says the overpayment occurred because Excellus did not properly document patient diagnoses. The report recommends Excellus refund money to the federalCenters for Medicare & Medicaid Services.

Excellus disputes the audit’s findings.

Medicare Advantage plans are private health insurance plans that receive payments from the federal Medicare program to provide medical services and supplies to the elderly and to people with disabilities.

Excellus had several contracts with Medicare to administer Medicare Advantage plans.
Under the contract reviewed in the audit, Medicare paid Excellus about $488 million to administer health plans for about 48,000 people.

Medicare makes monthly payments to insurers offering Medicare Advantage for each person enrolled in the plan. Federal law requires these payments to be adjusted according to the health status of each enrollee. Insurers are supposed to collect information about enrollees’ diagnoses from hospitals, outpatient facilities and doctors, and submit that information to Medicare.

The diagnoses Excellus submitted did not comply with federal requirements, according to the audit.

Auditors reviewed information submitted for a sample of 98 people enrolled in Excellus Medicare Advantage plans.

For 45 of those enrollees, the audit found Excellus submitted documentation that did not support the associated diagnosis, failed to provide any documentation in some cases or did not confirm the diagnosis.

Excellus was overpaid $157,777 for those 98 enrollees and should refund that money to Medicare, the audit says.

Based on that sample, the audit projects Excellus was overpaid $41.6 million for all the people covered under the contract.

The audit recommends Excellus work with Medicare to determine how much of that money should be refunded.

In written comments included in the audit report, Excellus says the overpayment finding is inflated and based on flawed data, including a too small sample size.

Elizabeth Martin, an Excellus spokeswoman, said the Medicare Advantage payment model was established with good intentions, but doesn’t fully recognize industry-wide documentation challenges for health plans, doctors and other providers.

Providers are typically paid on the basis of the procedures performed, not on the basis of an enrollee’s condition or diagnosis. Medicare holds insurers responsible for the accuracy of diagnosis data submitted and insurers in turn rely on doctors and other providers to submit accurate diagnosis data, she said.

“We audit a portion of the claims and medical records for accuracy, completeness and consistency,” Martin said. “However, the medical delivery system would grind to a halt if we made every provider submit all of the documentation for each and every claim they file on behalf of members.”

New York prohibits insurers from asking for records before payment, she said.

The audit report is not a final action, but a recommendation, said Donald White, a spokesman for the Inspector General.

The Centers for Medicare & Medicaid Services will ultimately decide how to respond to the recommendation.

Drive Less, Pay Less: Insurer MileMeter Proves Long-Distance Relationships Work

"People aren't going to make decisions just to save the earth," says Chris Gay. "But if you can save $1,000 a year, you're going to change your behavior." Gay isn't flogging a solar-powered gizmo or a carbon-trading scheme. He's selling insurance. His company, MileMeter, is looking to revolutionize car insurance -- while creating incentives to drive less.

Auto insurers usually charge a flat fee for a six-month plan. MileMeter, by contrast, sells auto insurance by the mile. If you drive fewer miles than the average driver, you should pay lower premiums. Gay envisions people rethinking their driving habits -- even moving closer to town -- after running the numbers. Recent studies out of the Brookings Institution and the University of California, Berkeley, support that claim. In 2008, Brookings found that adopting pay-per-mile car insurance nationwide would reduce our driving miles by 8%. It would take an added $1-a-gallon tax to produce the same effect.

Dallas-based MileMeter is the first company to offer pay-by-the-mile policies, but the idea goes back to the 1980s. That's when a lawsuit filed by the National Organization for Women argued that women were being overcharged for car insurance. NOW insurance project director Patrick Butler crunched the data and found a surprise: "It's not that women are safer drivers," he says. "It's that they drive less." Accidents increase at a steady rate with the number of miles driven.

That, Gay says, is what allows MileMeter to write profitable policies, while charging as little as $60 for 2,000 miles a year. One niggle: odometer fraud, which MileMeter combats by having customers send photos of their odometers periodically.

MileMeter has been available in Texas since October 2008. After a recent retooling that allows people to buy more miles as needed and to roll over unused mileage, the company is planning a national rollout in as little as a year. "The opportunity is huge," says Gay. "We're surrounded by greenfield."

A version of this article appears in the April 2010 issue of Fast Company.

What You Need to Know About Health Insurance for the Self-Employed

Being self-employed does not have to equal being uninsured. Actually, it does not even have to equal insanely expensive health care, either. When the health reform bill goes into full effect in 2014, you’ll be able to buy insurance, with guaranteed issue, at very reasonable rates through Health Benefits Exchanges.

But for now, we’ve got your best options for coverage and how to handle your medical expenses when it comes to taxes. If you’ve already tried or exhausted the usual suspects—COBRA or a spouse’s plan, try these sources:

Find a Professional Association

Many trade or professional organizations offer their members insurance at a group rate. Look into what organizations for your profession offer, or visit:

• National Association for the Self Employed (www.nase.org),
• Freelancer’s Union (http://www.freelancersunion.org/) for people in New York
• Fractured Atlas (http://www.fracturedatlas.org/) for artists and performers

Before you choose a plan, make sure it meets your individual needs. It’s often easy to choose a plan based on the premium alone, but this can be dangerous. There are at least three top things you should check out and understand before buying:

Deductible: This is how much you’ll have to pay out-of-pocket before the plan starts to cover your costs. So the lower the deductible, the better. There are a lot of high-deductible plans that look attractive because they have a low premium. This is not necessarily a bad thing, just know what your plan covers and be prepared with savings to cover your deductible if you need to.

Exclusions: This is all that fine print stuff. For example, prior authorizations, limitations on coverage, and exceptions to the rules. Let’s face it: most people aren’t going to read it all.  But you should at least understand the summary of benefits to make sure there aren’t huge holes in your coverage.

Network providers: This is important if you choose a PPO or HMO and you have specific doctors or hospitals where you get care. Make sure to check with both the plan and providers to see if they’re covered. 

If you’re really unsure, listen to what other people in the association have to say—group insight can be the most valuable!

Pre-Existing Conditions Insurance Plan (PCIP)

Every state operates a plan specifically for people with pre-existing conditions who have been denied coverage from an insurer. To qualify, you have to have been without coverage for the last six months and have some kind of proof of denial. The rates for PCIP are generally more affordable than the individual market. Get more info or apply online [www.pcip.gov].

Become a Group

Employer groups can purchase insurance without being denied the same way an individual can. And guess what? It only takes two to be a group. So if you are working alone, and hire one employee, you can purchase a group plan. Your rates can still be very high, but you will at least have access to coverage. Visit your state’s Department of Insurance or the National Association of Insurance Commissioners [naic.org] for help setting up a group plan.

And for the taxes…

If you’re self-employed, you can deduct the cost of health insurance for yourself, your spouse, and your dependents. You do not even have to itemize your expenses—the self-employed deduction is completely separate (although, you certainly can and should if your expenses are high). Keep in mind that the health plan must be under your name or your business’ name (not a spouse), and you must have made a net income that year. If you had a loss, you can’t take the deduction.

You've seen the ads: "." Technically, that's true.
But some people who give away an old auto might find their tax break smaller than they expected. And a few donors, thanks to the intricacies of vehicle gift guidelines, might be able to boost their deduction amounts.

Giving away a clunker to a charity used to be straightforward. You could claim the old car's fair market value, that is, the amount a willing buyer would pay a willing seller for the product. Typically, you'd refer to auto valuation services, such as the Kelley Blue Book, to get an idea of the donated car's value, give it to your favorite nonprofit and then drive off with a tax break equal to that valuation amount. No more.

Because some taxpayers got greedy, claiming much more than their old autos were worth, lawmakers tightened the rules on how much you can write off for a vehicle donation. Now the precise tax break depends on the donor's claimed value of the gift and how the charity uses the vehicle.

"This puts taxpayers in the unusual situation of not knowing the size of their deduction when they make the donation," says Bob D. Scharin, senior tax analyst from the Tax and Accounting business of Thomson Reuters.

$500 limit

In most instances, a taxpayer must take into account a $500 threshold on vehicular gifts. This value amount applies to autos, boats and even airplanes. When the donated vehicle's value (based on credible fair market value analyses) exceeds that amount, claiming the deduction gets more complicated.

This valuation ceiling comes into play when a charity sells a donated vehicle. In this case, just how much a taxpayer can deduct depends on the amount the sale nets.

For example, you donate your old station wagon that's worth $1,000. Under the old rules, that would be the amount you could deduct. But now, if the charity turns around and sells your donation for $800, your deduction is limited to the lower sales price.

The charity must give you substantiation of the IRS-allowed donation amount within 30 days of when you turn your car over to the charity or, if the group sells the auto, within 30 days of the vehicle's sale.

By now, you should have gotten word from the charity as to what it did with your old vehicle. If you haven't heard from the charity, give it a call and ask that it send, or resend, you the donation specifics.

Plus, you now must include a copy of the acknowledgment with your tax return. Previously, such receipts were generally only kept by the taxpayer in case the IRS questioned a claimed deduction.

Intervening-use exception

The vehicle donation law, however, does provide a few exceptions that will allow a giver to claim the auto's fair market value.

Say you donated your $1,000 station wagon to a food bank. Instead of immediately selling it, the group used the auto for several months to deliver meals and other food items to needy families. Eventually, the organization decided to sell the vehicle for $800. In this case, you could still claim the full $1,000 fair market value of the auto as long as you received documentation from the food bank on not only the sales price, but how the auto was used for nonprofit works before the sale. Under the IRS regulations, this is classified as "significant intervening use" of the vehicle that allows the taxpayer to claim the higher deduction.

Other examples of IRS-accepted intervening use are a donated auto used by a charity to transport clients to doctor appointments or a car given to a vocational school that used it in its automotive repair classes.

The IRS says a donor also can claim a fair market value deduction if the charity makes a material improvement to the vehicle. This, according to the tax agency, means major repairs that significantly increase the auto's value. Material improvements do not include finish work (such as painting, waxing or rust proofing), dent or scratch removal, installation of theft-deterrent devices, or the cleaning or repair of upholstery.

Break for bargain basement sales

What if the charity immediately sells your donated station wagon, but for a mere $300?
Scharin says don't shortchange yourself. Under the new auto-donation rules, you might be able to claim a $500 deduction even though the charity sold your auto for $200 less.

The IRS says this larger deduction allowance is OK in cases where a charity sells a donated vehicle at a price significantly below market value, or even gives it away to a needy person, as long as it's done to further the charity's mission of helping a poor person who needs transportation.

Be careful here. Make sure the vehicle did indeed go to a needy individual. Shortly after the vehicle donation rules changes, the IRS discovered that some charities sold autos at auction but reported that the sales -- at prices well below market value -- were to disadvantaged buyers, to trigger the exception that allows the donor a higher deduction amount. If the IRS discovers such false reporting, it could totally disallow your donation and deduction.

Also keep in mind that regardless of how a charity disposes of your donated vehicle, your deduction cannot exceed the value of your donation. So if you donate a clunker worth $150, says Scharin, that is the amount you can deduct even if the charity gives the auto away.

Other donation rules still apply

Of course, the general tax laws regarding all charitable gifts still apply to automotive gifts.
First, the timing of your donation is critical. All charitable gifts must be made in the tax year for which you are filing the return. To claim a donated auto on your current tax return, you must have given the vehicle to a charity by last Dec. 31.

Be sure to check out the charity before dropping off your auto. Thousands of philanthropic groups accept gifts of vehicles. The important thing is to make sure that the one you select is a reputable and tax-qualified organization. Unfortunately, some con artists take advantage of people's good intentions and accept cars that never go to philanthropic causes.

Other groups may well do valuable community work but are not approved charitable organizations under IRS rules. Ask for copies of the group's federal tax-exempt status documents. You also can check out the IRS' Web site directory to see if the charity is on the approved list or peruse GuideStar's registry at www.guidestar.org. That site provides information on millions of U.S. nonprofit organizations. Finally, you can call the IRS at (800) 829-1040 and ask about the group's tax status.

Charitable gifts require itemization

Next, to write off your auto gift, you must itemize instead of claiming the standard deduction. That means you have to keep track of what you give and file the long Form 1040 and Schedule A.
If your old car is the only deduction you can claim on Schedule A, giving it to a charity may not be worth it from a tax standpoint. But if your itemized expenses are close to your standard deduction amount, adding the value of a donated car could be just what you need to make itemizing the right tax choice this year.

Also keep in mind that as a deduction, the value of your car does not directly cut your tax bill. Deductions are used to reduce your taxable income, which usually does mean you'll owe less taxes. But a deduction's actual worth depends on your tax bracket. That means a donation of a $300 auto translates to a tax cut of only $75 for a filer in the 25% tax range.

So if you would rather have the cash instead of a comparatively small tax break, sell your old auto. If, on the other hand, you're feeling generous -- or don't want to spend what it would take to get the clunker in sellable shape -- giving it to a charity might be the better route.

How Much Can I Deduct?

When you donate a car you may deduct the fair market value when filing your taxes. You can determine this value using tools like Cars.com's Kelley Blue Book Used-Car Values calculator.

The actual amount you are able to deduct is dependent on what the charity does with the donated vehicle. Your charity could do one of the following:

• Sell the vehicleYour deduction is limited to the gross proceeds the charity receives from selling the vehicle. If that amount is less than $500, you may be able to deduct the fair market value up to $500.
• Make use of the vehicle, make a material improvement to the vehicle or sell the vehicle to a needy individual for below fair market valueYou may be able to deduct your vehicle's fair market value on the date you donated it.

http://www.cars.com/go/advice/car-donation/tax-deduction.jsp

You've seen the ads: "Donate your car and get a tax break." Technically, that's true.

But some people who give away an old auto might find their tax break smaller than they expected. And a few donors, thanks to the intricacies of vehicle gift guidelines, might be able to boost their deduction amounts.
Giving away a clunker to a charity was once straightforward. You could claim the old car's fair market value, that is, the amount a willing buyer would pay a willing seller for the product. Typically, you'd refer to auto valuation services, such as the Kelley Blue Book, to get an idea of the donated car's value, give it to your favorite nonprofit and then drive off with a tax break equal to that valuation amount. No more.
Because some taxpayers got greedy, claiming much more than their old autos were worth, lawmakers tightened the rules on how much you can write off for a vehicle donation. Now the precise tax break depends on the donor's claimed value of the gift and how the charity uses the vehicle.
"This puts taxpayers in the unusual situation of not knowing the size of their deduction when they make the donation," says Bob D. Scharin, senior tax analyst from the Tax & Accounting business of Thomson Reuters.

$500 limit

In most instances, a taxpayer must take into account a $500 threshold on vehicular gifts. This value amount applies to autos, boats and even airplanes. When the donated vehicle's value (based on credible fair market value analyses) exceeds that amount, claiming the deduction gets more complicated.
This valuation ceiling comes into play when a charity sells a donated vehicle. In this case, just how much a taxpayer can deduct depends on the amount the sale nets.
For example, you donate your old station wagon that's worth $1,000. Under the old rules, that would be the amount you could deduct. But now, if the charity turns around and sells your donation for $800, your deduction is limited to the lower sales price.
The charity must give you substantiation of the Internal Revenue Service-allowed donation amount within 30 days of when you turn your car over to the charity or, if the group sells the auto, within 30 days of the vehicle's sale.
By now, you should have gotten word from the charity as to what it did with your old vehicle. If you haven't heard from the charity, give it a call and ask that it send, or resend, you the donation specifics.
Plus, you now must include a copy of the acknowledgment with your tax return. Previously, such receipts were generally only kept by the taxpayer in case the IRS questioned a claimed deduction.

Read more: Donating A Vehicle To Charity | Bankrate.com http://www.bankrate.com/finance/money-guides/donating-a-vehicle-to-charity-1.aspx#ixzz29Q5rR0gE

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• It's simple - get a quote in 2 minutes.
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Things to think about

Our cover includes Terminal Illness Benefit: as long as your plan has at least 18 months to run, we'll pay out if you're diagnosed with a terminal illness and not expected to live more than 12 months. This is not the same as Criticall Illness cover. If we pay out after a terminal illness claim, your plan will end.

Please note that there's no cash in value at any time. If you stop paying premiums or live to the end of the plan the cover will end and no money will be returned to you.

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