By Raga Justin | Times Union, Albany
Albany, N.Y. — A major insurer for many New York state retirees improperly paid over 200 insurance claims costing over $5 million, according to an audit by the state comptroller’s office.
The audit centered on evaluating insurance claims submitted by Anthem Blue Cross — formerly Empire Blue Cross — from a three-year period between January 2020 and June 2023 and found that the major insurer had overpaid certain claims for retirees that should have been taken on by other insurers.
The New York State Health Insurance Program, run by the Office of Civil Service, is responsible for health coverage for more than 1.2 million active and retired public employees, according to the audit. While the primary insurer for most of those individuals is Anthem Blue Cross, through the Empire Plan, many members are also enrolled in the federal Medicare program for people who are 65 or older.
Because retirees are dually enrolled in two insurance plans, Anthem is responsible for coordinating benefits to determine which insurance plan pays first and which plan pays second, with the former typically shelling out more money for the claim, according to the audit. Enrollees who are over 65 would typically have most of their services primarily covered by Medicare, with Anthem picking up the rest of the tab.
But Anthem improperly overpaid for 241 claims in the three-year period reviewed, costing them nearly $5.3 million, according to the comptroller’s office.
The incorrect payments occurred because Anthem was not always updated with members’ Medicare eligibility information and had some structural weaknesses in enrollment data, the audit found.
Officials with Anthem acknowledged the improper payments and said they would work to pursue recoveries.
“The primary health insurance for more than 1 million public workers paid out more than $5 million on claims that should have been submitted to Medicare first for payment,” state Comptroller Thomas DiNapoli said in a statement. “My latest audit calls for improvements to avoid such improper billing to save the state money.”
The state comptroller has the authority to audit records of private firms contracted with the state. The office recommended that Anthem work with the state’s civil service agency to enhance data sharing and thoroughly train staff members to properly process claims for retirees who have Medicare.
The health insurance landscape in the Capital Region has gone through several shifts in recent months, including an announcement earlier this summer that the St. Peter’s Health Partners hospital system had failed to renew a contract with the major health insurance network UnitedHealth. That happened amidst a public dispute over reimbursement rates.
And last month, the Capital District Physicians’ Health Plan said it was considering slashing certain benefits and raising premiums for people with Medicare Advantage plans as a result of federal policy changes.
Blue Cross Blue Shield has operated in New York since 1934; the Empire brand has been in use since 1985. The Anthem companies operate in 13 states, including New York.
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