Congress moves to stop Medicare Advantage plans from gaming diagnosis codes
S. 1105 — No UPCODE Act · Filed by Bill Cassidy (R-LA) · 1 cosponsor · Introduced Mar 25, 2025 · Referred to committee
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What it does
This bill amends Medicare Advantage risk adjustment rules to reduce overpayments caused by aggressive diagnosis coding. Starting in 2026, it requires the government to use two years of diagnostic data instead of one, excludes diagnoses found only through chart reviews and health risk assessments (common sources of upcoding), and mandates annual evaluation of coding differences between Medicare Advantage plans and traditional Medicare providers, with public reporting and potential plan-level adjustments to correct for inflated risk scores.
Why we flagged it
The bill's core mechanism is to reduce systematic overpayment of Medicare Advantage plans through stricter diagnosis data sourcing and mandatory coding-pattern audits. It is fundamentally an anti-fraud and fiscal-accountability measure, not a subsidy or deregulation.
What the text implies
- Medicare Advantage insurers may respond by reducing supplemental benefits (dental, vision, hearing) or narrowing provider networks to offset lower risk-adjustment payments, potentially harming beneficiary access even as government payments decline.
- The exclusion of chart-review diagnoses may inadvertently penalize legitimate clinical documentation practices if the Secretary's identification procedures cannot reliably distinguish between appropriate chart reviews and upcoding schemes.
The full analysis lists 4 implications of this text.
Who stands to gain
Medicare trust fund (reduced overpayments); Medicare beneficiaries (lower premiums and out-of-pocket costs); Taxpayers (reduced federal spending on Medicare Advantage)