Healthfirst will pay $35M to NY over Medicaid violations

Health plan Healthfirst has reached a $35 million settlement with New York Attorney General Andrew Cuomo over its violation of Medicaid managed-care contract and false-marketing plans filed with state and city officials. The plan, New York's largest Medicaid managed-care provider, violated contract terms by paying inappropriate bonuses and other incentives to sales professionals based on enrollment levels they accomplished between 1999 and September 2003. Healthfirst also failed to disclosed the productivity-based bonuses in the materials it filed with officials. Healthfirst officials noted, in discussing the settlement, that the violations were self-disclosed, and that it has changed its practices completely since that time to conform to regulatory requirements.

While Healthfirst may have changed its ways, it seems likely that we're going to continue to see issues in both Medicaid and Medicare managed care marketing, given the size of the payoff in going for high volume and the relatively vulnerable consumer targeted by each. It seems likely that some reforms are going to be needed going forward to address such issues over the longer term.

To learn more about this case:
- read this Modern Healthcare piece (reg. req.)

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