Minnesota Attorney General Lori Swanson is asking the federal government to investigate Humana's Medicare Advantage policies after uncovering what she said were "significant problems" reported by Minnesota patients and medical providers.
Affidavits gathered from 25 Minnesotans showed a pattern where Humana denied claims for medical services required by law, overcharged for co-payments and coinsurance, and failed to disclose the providers that are in the network, she said. Swanson's office also found that Humana didn't follow procedures laid out by federal regulations for patients to appeal their cases.
"They were stringing people along, taking months to get back to people," she said. "Oftentimes, it took the intervention of our office — and oftentimes we had to write multiple times."
Humana, based in Louisville, Ky., is one of the nation's largest health care insurers in Medicare Advantage, a private policy that covers seniors and those with disabilities. Humana has been doing business in Minnesota for more than 10 years, and provides insurance coverage to more than 100,000 residents through various types of Humana Medicare Advantage plans, including a plan for prescription drugs, according to a company official.
Humana spokeswoman Kate Marx said in an e-mail that the insurer has not been notified of the complaint by the Minnesota attorney general's office or by federal regulators.
"We take this very seriously and are working to identify the facts," Marx said.
Marx noted that Humana's Minnesota Medicare Advantage plans achieved one of the highest ratings for performance and service by the federal government this year, with a rating of 4.5 stars on a five-star scale.
Dawn Kern, a business office manager at Bigfork Valley Hospital Clinics and Community in northern Minnesota, has not had a top-star experience. Her staff spent two years and "countless hours" trying to get Humana to pay for two claims for home care services that are worth $7,000 and $1,700, she said.
The hospital made more than 25 phone calls, sent letters and supporting documents and still hasn't been reimbursed for the 2011 services, Kern said in her affidavit. The insurer also has denied payment for routine screening procedures, such as mammograms, and hospital stays for observational care that exceeded 24 hours, both of which are covered under Medicare.
"Humana has been a nightmare to work with due to its frivolous denials, horrible customer service, and lengthy and often fruitless appeal process," Kern said.
This is the first action the attorney general's office has taken against Humana, according to a spokesman, but the company has come under fire in the past from the Centers for Medicare and Medicaid Services (CMS), the federal agency that oversees Medicare.
In October 2010, the agency fined Humana $55,880 for failing to provide accurate beneficiary information through its Medicare Advantage Organization, including changes it made to benefits and cost-sharing.
In September 2009, CMS warned Humana to stop mailing letters that warned enrollees they could lose Medicare Advantage benefits as Congress was debating health reform proposals. Humana's chief medical officer had urged subscribers to contact congressional representatives to protest the action.
And a 2007 CMS audit raised concerns about Humana's marketing practices, a year after Medicare's Part D prescription drug benefit was enacted. Officials said Humana wasn't doing enough to curb misleading sales practices to seniors and those with disabilities who thought they were signing up for drug coverage but ended up enrolled in comprehensive plans.
Retiree Karen Merrick, 70, of North St. Paul, spent six months writing and calling Humana over a $258 claim for glasses she needed after cataract surgery in 2011.
The insurer paid for the surgery, but Merrick, who is on a fixed income, said she got into a loop with customer service representatives who couldn't resolve her complaint or called back with prerecorded phone messages every two weeks.
Humana finally sent the check, but then sent a follow-up letter saying Merrick had to return $215 of it.
"That's a lot of money when you're only living on Social Security," said Merrick, who said she's still fighting to get the insurer to pay for a whooping cough vaccine.
Congress has forbidden states from regulating such claims, leaving Swanson's office with only the ability to gather such information and apply public pressure on CMS to act.
Swanson on Friday mailed a document the size of a phone book to CMS officials along with an e-mail that contained sworn statements of Minnesotans. Complaints are still coming in regularly, she said.
"Basically we want to see Humana keep the promises they made to senior citizens," Swanson said.
The action comes as the open enrollment period for seniors to select Medicare coverage has begun. It runs through Dec. 7.