The United States has reached a settlement agreement with Cigna Group (Cigna), an insurance company that owns and operates Medicare Advantage Programs (MA Plans), also known as Medicare Part C. Cigna will pay over $172 million to resolve allegations that it violated the False Claims Act by submitting and failing to withdraw false diagnosis codes for its MA Plan beneficiaries to increase payments received from Medicare. Medicare beneficiaries have the option of obtaining their benefits through private insurers, such as Cigna, which are paid by the Centers for Medicare and Medicaid Services (CMS) a fixed monthly rate for each beneficiary who enrolls (also known as “capitation”). CMS adjusts these rates to account for various “risk” factors that impact expected healthcare costs. This ensures that MA Plans receive more funding for beneficiaries who may incur higher costs. To ensure proper adjustment of funds, CMS collects “risk adjustment” data from MA plans, relying mainly on diagnosis codes to make payment decisions.
The United States alleges that Cigna submitted false patient diagnosis data to CMS to make patients appear sicker than they are to inflate their MA Plan payments. Cigna continuously failed to withdraw this faulty data, certifying in writing that its data was correct. From 2014 to 2019, Cigna operated a program to review patients’ charts, reviewing documents from previous healthcare providers that documented services given and medical conditions noted prior to being with Cigna. The company then retained diagnosis coders to review the charts and identify all medical conditions and assign beneficiaries with diagnosis codes for those conditions. Cigna submitted additional diagnosis codes to CMS that the healthcare providers did not report, allowing them to collect additional payments. Cigna’s chart review revealed that some diagnosis codes reported by providers were not valid, but Cigna did not delete them, since doing so would have required Cigna to reimburse CMS. Because of this, the United States also alleged that Cigna used the results of its chart reviews to seek additional payments, but ignored those results when they identified instances where Cigna was overpaid.
The United States further alleged that from 2016 to 2021, Cigna knowingly submitted or failed to delete inaccurate diagnosis codes for morbid obesity to increase payments from CMS. Individuals with a body mass index (BMI) below 35 cannot be properly diagnosed with morbid obesity, but Cigna submitted many of these claims for individuals who did not meet the criteria. The Cigna reported diagnosis codes were based solely on forms completed by Cigna-retained healthcare providers who did not perform or order necessary diagnostic testing to diagnose morbid obesity or any of the serious conditions it alleged its patients had. These diagnoses had no documentation to support their existence, yet Cigna still submitted them to CMS to garner increased payments, falsely certifying year after year that their reports were accurate and truthful.
The Deputy Inspector General for Investigations with U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) expressed his disdain for Cigna’s actions, stating, “Medicare Advantage plans that submit false information to increase payments from CMS show blatant disregard for the integrity of these vital federal health care funds … Such actions are an affront to the Medicare program and the millions of patients who rely on its services.” To rectify this damage, Cigna has entered into a five-year Corporate Integrity Agreement with HHS-OIG. This requires Cigna to implement accountability and auditing provisions, and its executives must certify its compliance measures annually. An independent review organization will also conduct audits of the company.
This Medicare Part C fraud settlement was due in part to a courageous whistleblower, Robert A. Cutler, a former part-owner of a vendor retained by Cigna to conduct home visits. Cutler will receive $8.1 million for his efforts to protect taxpayer dollars and restore the integrity of MA Plans.
If you would like to report Medicare Part C or Medicare Advantage fraud, you can contact attorneys at Tycko & Zavareei LLP. Eva Gunasekera and Renée Brooker are former officials of the United States Department of Justice and prosecuted whistleblower cases under the False Claims Act. Renée served as Assistant Director at the United States Department of Justice, the office that supervises False Claims Act cases in all 94 United States District Courts. Eva was the Senior Counsel for Health Care Fraud. Eva and Renée now represent whistleblowers. For a free consultation, you can contact Renée at [email protected] (tel.: 202-417-3664) or contact Eva Gunasekera at [email protected]. You can also go to Tycko & Zavareei LLP’s website for whistleblowers to learn more at www.fraudfighters.net.