Judge Vacates Medicare Advantage 2014 Overpayment Final Rule

UnitedHealth and other insurers had filed suit against HHS, claiming the overpayment rule 'failed to satisfy a statutory mandate of actuarial equivalence.' A judge agreed.

A federal judge on Friday sided with UnitedHealth and other health insurers and vacated the federal government's 2014 final rule on Medicare Advantage overpayments.

In a 30-page ruling issued Friday morning, U.S. District Judge Rosemary Collyer in Washington, DC, agreed with the health insurers that the final rule "will inevitably fail to satisfy the statutory mandate of actuarial equivalence."

The UnitedHealth-led suit was filed in 2016, and insures had argued that the 2014 statute requires "actuarial equivalence" between Centers for Medicare & Medicaid payments for care delivered under traditional Medicare and Medicare Advantage.

Instead, the health insurers successfully argued, the 2014 final rule imposed a stricter standard on MA carriers than on CMS itself when paying Medicare benefits.

Collyer also denied the Department of Health and Human Services' cross motion for summary judgment, and vacated the overpayment rule. 

UnitedHealth spokesman Matt Burns praised the ruling and said it "sets an important precedent and affirms the government must apply its actuarial standards equally to Medicare Advantage plans and fee-for-service Medicare.”

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