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Jon Decker: OptumRx and UnitedHealth Group Drown in Overbilling Lawsuits, AARP Remains Silent

The Mississippi State Auditor's Office is now investigating whether UnitedHealth Group over-billed Medicaid for prescription drugs

When it comes to adhering to the rules, Pharmacy Benefit Managers (PBMs)—the middlemen of the healthcare industry—are known to play fast and loose. OptumRx, a subsidiary of the nation’s largest health insurance company UnitedHealth Group (UHG), is certainly no exception. Time and again, these corporate middlemen have found themselves in legal hot water, taking advantage of the U.S. healthcare system by overcharging patients and taxpayers. But in the case of OptumRx, what makes their recent scandals most noteworthy is how it exposes the AARP– an organization that purports to advocate for the interest of seniors– as a front for big insurance.

Between 2012 and 2016, OptumRx and another PBM, Aetna, exchanged emails about using “dummy codes” to “bury” unbillable administrative fees as medical treatments for a Virginia-based company’s self-funded insurance plan. This code is known as the “Current Professional Technology Code,” which the American Medical Association (AMA) holds a copyright to and is designated for procedures used in medical billing. The AMA claims its licenses were misused by OptumRx and Aetna in this scheme to pass higher costs on to customers.

Along with support from the AMA, a member of the Virginia company’s healthcare plan took matters into her own hands. Sandra Peters filed a lawsuit against the PBMs in 2015 for overbilling. Although it failed in the lower court in 2019 and ended in favor of OptumRx and Aetna, a federal appeals court reversed the ruling earlier this year, giving the corporate middlemen a taste of its own medicine.

However, that hasn’t stopped OptumRx from continuing its pattern of suspicious behavior in Mississippi.

Recently, the Mississippi State Auditor's Office announced an investigation into whether UnitedHealth Group is over-billing Medicaid for prescription drugs. And at the heart of the Auditor Office’s probe is OptumRx. Mississippi initially contracted with UHG and its subsidiary OptumRx in 2017, a relationship that has made OptumRx parent company UnitedHealth nearly $250 billion. But investigators now believe that revenue was ill-gotten, and the PBM has actually been charging the government more than they were contractually permitted.

That’s a serious charge, to be sure. The Auditor’s Office is effectively claiming that UHG and OptumRx is stealing money from the Mississippi taxpayer while also raising prescription costs for patients.

Although these lawsuits and investigations are concerning in and of themselves, what’s even more concerning is the reaction, or lack thereof, from the AARP, which partners with UnitedHealth Group and OptumRx to offer health insurance plans to its members. Despite the myriad accusations against their business partners, the AARP remains silent. But isn’t the AARP’s purpose to “advocate for seniors?”

Something doesn’t add up – and the answer, unfortunately, is money.

AARP makes a killing from its business relationship with UHG. To put it simply, UnitedHealth Group pays AARP royalties to have AARP’s logo and brand on its insurance plans. In return, AARP receives billions of dollars in what lawsuits have referred to as illegal “kickbacks.” In this way, AARP makes money hand over fist when its members buy UHG-branded insurance—they don’t want to bite the hand that feeds them.

No wonder all we hear are crickets from AARP amid these serious accusations.

As the silence continues, OptumRx and UnitedHealth Group openly flout what AARP purports to stand for. Blatantly overcharging for health-essential drugs is a direct attack on the elderly, who have suffered immensely during the ongoing global pandemic. Seniors deserve support and increased access at low costs in the middle of this health crisis, but instead, they are receiving precisely the opposite.

While AARP attempts to portray itself as a classic membership and senior advocacy organization, its financial ties belie that claim. It’s time AARP abandons its corporate bond with OptumRx and UnitedHealth Group and begins to advocate for its members. Only then will it truly represent seniors.

Jon Decker is the executive director of American Commitment.

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