further alleges that Permanente physicians submitting the addenda for these diagnoses “often did not tell their patients that they supposedly had the diagnoses for which the Kaiser Health Plans claimed payment.” Finally, the government contends that Kaiser had knowledge that these practices were improper and ignored red flags and internal complaints. In United States v. Anthem, Inc . , the United States filed suit against Anthem concerning the defendant’s Medicare risk-adjustment data submissions to CMS. 218 The allegations involve Anthem’s knowing failure to delete inaccurate diagnosis codes submitted to CMS for risk adjustment purposes. The government alleged that Anthem conducted a one-sided review of beneficiaries’ medical charts with the goal of adding diagnosis codes to submit to CMS to gain revenue, without also identifying and deleting inaccurate codes. The matter is ongoing. In U.S. ex rel. Cutler v. Cigna Corp. , the pending qui tam lawsuit alleges that Cigna- HealthSpring submitted fraudulent claims by misrepresenting the diagnoses of its beneficiaries in violation of the FCA. 219 The relator contends that Cigna-HealthSpring created a program ultimately designed to raise plan members’ risk scores to inflate monthly capitated payments by inappropriately capturing diagnoses not supported in the underlying medical record. According to the complaint, Cigna-HealthSpring encouraged nurses to diagnose beneficiaries with exaggerated medical problems, promoted falsification of diagnoses and reported health conditions not supported by medical documentation or reliable clinical information. On September 29, 2021, the district court granted Cigna- HealthSpring’s motion to transfer the matter to the U.S. District Court for the Middle District of Tennessee, where the matter remains pending. 220 In U.S. ex rel. Ross v. Independent Health Assoc. , the United States intervened in a qui tam lawsuit alleging that a health insurer defrauded the government by submitting false patient data to wrongfully inflate Medicare Advantage payments. 221 The government’s complaint alleges that Independent Health improperly submitted and received payment for risk-adjusting diagnoses codes that were not supported in the underlying medical record. The government further contends that Independent Health created a subsidiary, which sought to capture additional risk-adjusting diagnoses codes through retrospective one-way chart review and utilizing an addenda process in which providers were sent “leading and suggestive forms” aimed at capturing additional diagnosis codes. In U.S. ex rel. Fernandez v. Freedom Health, Inc. , a relator filed a qui tam lawsuit alleging that Freedom Health, Inc., Optimum Healthcare, Inc. and Physician Partners, LLC (defendants) intentionally submitted incorrect and/or unsubstantiated risk adjustment data as part of a scheme to increase their capitation payments. 222 Specifically, the relator alleges, among other things, that Physician Partners: (1) forged primary care physicians' prescriptions for leg and cardiac scans; (2) pressured its patients to schedule leg and cardiac screenings even though the tests were not medically necessary; and (3) badgered
National Diagnostic Systems (NDS) into using diagnosis codes relating to serious diagnoses to increase the risk score for the defendants' Medicare Advantage members to receive enhanced payments from Medicare. The district court granted the defendants’ motion to dismiss in this declined qui tam action based on the relator’s failure to plead with the requisite particularity under Rule 9(b), but permitted the relator leave to amend. The relator’s counsel has since filed a motion for a stay of the action because of an inability to contact the relator because the relator had been incarcerated pending trial on federal healthcare fraud charges, which remains pending. OVERPAYMENT RULE Under the Medicare Part C Overpayment Rule, MAOs must report and return “overpayments” to CMS within 60 days of identification. 223 According to the Overpayment Rule’s preamble, any diagnosis that has been submitted by a Medicare Advantage insurer for payment but is found to be invalid because it does not have supporting medical record documentation would result in an overpayment. Essentially, this rule requires Medicare Advantage insurers to refund amounts they know were overpayments, i.e. , payments they are aware lack support in a beneficiary’s medical records. In UnitedHealthcare Ins. Co. v. Azar , UnitedHealthcare filed suit seeking a determination that the Overpayment Rule violates actuarial equivalence and the same methodology requirements. 224 Those provisions entitle plans to receive payments equal to the amount CMS would expect to spend covering identical beneficiaries insured by traditional Medicare and require CMS to use the same criteria to measure risk in both traditional Medicare and Medicare Advantage programs. The Overpayment Rule, conversely, results in different payments for identical beneficiaries because it relies on both supported and unsupported codes to calculate risk in the Medicare fee for service program but only supported codes in the Medicare Advantage program, which means Medicare Advantage plans are not paid the same as CMS for identical beneficiaries. In fact, “it makes Medicare Advantage beneficiaries appear artificially healthier than their CMS counterparts, and inevitably underpays the plans.” Siding with UnitedHealthcare in September 2018, the district court vacated the Medicare Part C Overpayment Rule finding it was “arbitrary and capricious” and “violate[d] the statutory mandate of ‘actuarial equivalence.’” 225 The government subsequently appealed the district court’s opinion to the D.C. Circuit. In a highly anticipated decision, the D.C. Circuit reversed the district court and held that the Overpayment Rule does not violate the Medicare statute’s “actuarial equivalence” and “same methodology” requirements, and is not arbitrary and capricious as an unexplained departure from prior policy. 226
218 No. 1:20-cv-02593, Dkt. No. 1 (S.D.N.Y. Mar. 26, 2020). 219 No. 7:17-cv-07515-KMK-JCM, Dkt. No. 94 (S.D.N.Y. Oct. 2, 2017). 220 No. 3:21-cv-00748 (M.D. Tenn.) 221 U.S. ex rel. Ross v. Independent Health Assoc. , No. 1:12-cv-00299-WMS, Dkt. No. 142 (W.D.N.Y. Sept. 13, 2021) (complaint in intervention). 222 2021 WL 2954415 (M.D. Fla. May 26, 2021).
223 42 U.S.C. §1320a-7k(d)(1)-(2)). 224 UnitedHealthcare Ins. Co. v. Azar , 330 F. Supp. 3d 173, 176 (D.D.C. 2018); UnitedHealthcare Ins. Co. v. Becerra et al ., 2021 WL 3573766 (D.C. Cir. 2021). 225 See UnitedHealthcare Ins. Co. v. Azar , 330 F. Supp. 3d 173, 176 (D.D.C. 2018). 226 UnitedHealthcare Ins. Co. v. Becerra , 2021 WL 3573766 (D.C. Cir. 2021).
MANAGED CARE/MEDICARE ADVANTAGE BASS, BERRY & SIMS | 39
Powered by FlippingBook