Goodsurance

Medicare Advantage

Federal Auditors Found Medicare May Have Overpaid Medicare Advantage Plans 462 Million Dollars for Stroke Diagnoses That Lacked Hospital Records

An OIG audit of 2021 claims found that acute stroke diagnosis codes appearing on physician records across a sample of Medicare Advantage enrollees had no corresponding hospital record, a pattern auditors say inflated risk scores and generated large overpayments.

By the Goodsurance editorial teamSeptember 3, 2026

The Office of Inspector General of the Department of Health and Human Services published a report in May 2026 finding that Medicare may have made approximately 462 million dollars in net overpayments to Medicare Advantage organizations for the 2021 payment year, based on acute stroke diagnosis codes that were not supported by hospital records.

The audit examined a stratified random sample of 97 Medicare Advantage enrollees whose plans submitted acute stroke diagnosis codes in 2020. For every sampled enrollee, the diagnosis appeared on a physician record but no matching acute stroke diagnosis was found in inpatient or outpatient hospital records for the same service year. The OIG concluded that the absence of a hospital record suggests the acute event may not have occurred in the year the code was submitted.

OIG found Medicare Advantage plans may have been overpaid 462 million dollars for acute stroke diagnoses with no matching hospital record.

The discrepancy matters because Medicare pays Medicare Advantage plans a monthly capitation amount that rises when certain serious diagnoses are reported for an enrollee, raising the enrollee's risk score. Acute stroke is a high-acuity diagnosis that significantly increases that score. The OIG estimated that overpayments from this specific coding pattern reached 462 million dollars across all Medicare Advantage plans nationwide for 2021 alone.

The OIG recommended that CMS develop a process to identify and recover overpayments tied to this pattern, and build claims-level edits that would flag future cases where an acute stroke code appears on a physician claim but no corresponding hospital code is found for the same enrollee and year. CMS agreed with the recommendations.

In plain words

Medicare pays extra money each month to private Medicare Advantage plans when their members are sicker. Plans must tell Medicare what health problems each person has. Auditors found that some plans said a member had a stroke, but there was no hospital record of that stroke. When that happens, the plan gets paid too much. Auditors checked a sample of cases and found the same problem every time. They estimated this may have cost Medicare 462 million dollars in just one year. The government said Medicare should find and recover those extra payments.

Understand the basics first

Source: OIG
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