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WASHINGTON — The Biden administration backed off some of its plans to rein in billions of dollars from wasteful spending in Medicare Advantage next year, after intense lobbying from health insurance companies.

The administration will now phase in its changes to Medicare Advantage’s so-called risk adjustment program over three years, rather than all at once, softening the immediate blow to the companies’ payments and stretching out the timeline for reining in the spending.


Insurers get higher payments from the government by coding more illnesses, and Medicare officials say insurers exploit the system in some cases by reporting that their members are sicker than they are. To fix that problem, Medicare is removing or consolidating codes for certain conditions, such as peripheral artery disease and chest pain, that lead to inflated payments.

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