Cigna will pay $172 million for allegedly overcharging Medicare Advantage

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Health insurer Cigna has agreed to pay $172 million to resolve allegations that it padded its reimbursement by submitting false Medicare Advantage diagnostic codes.

The agreements resolve a False Claims Act lawsuit brought by a whistleblower and the federal government linked to past risk adjustment submissions from certain types of patient records, some dating back more than a decade.

As part of the resolution, the Cigna Group will also enter into a Corporate Integrity Agreement (CIA) with the Office of Inspector General of the U.S. Department of Health and Human Services. The CIA is designed to promote ongoing compliance with federal health program requirements over a period of five years.

WHAT'S THE IMPACT?

The original complaint, filed late last year, alleged that the reported diagnosis codes were based solely on forms completed by vendors retained and paid by Cigna to conduct in-home assessments of plan members. The healthcare providers who conducted these home visits – nurse practitioners, typically – did not perform or order the testing or imaging that would have been necessary to reliably diagnose the serious, complex conditions reported, according to the Department of Justice. Cigna also allegedly prohibited the providers from providing any treatment during the home visit for the medical conditions they purportedly found.

The diagnoses at issue were not supported by the information documented on the form completed by the vendor and were not reported to Cigna by any other provider who saw the patient during the year in which the home visit occurred, the DOJ claimed. Nevertheless, Cigna submitted these diagnoses to the government to claim increased payments and, according to the DOJ, falsely certified on an annual basis that its diagnosis data submissions were "accurate, complete, and truthful."

The home visits under Cigna's "360 comprehensive assessment" program, typically conducted by nurse practitioners and on occasion by other nonphysician healthcare providers such as registered nurses and physician assistants ("Vendor HCPs"), were not conducted for the purpose of treating medical conditions, the DOJ alleged. Rather, they were performed for the primary purpose of capturing and recording lucrative diagnosis codes that would significantly increase the monthly capitated payments Cigna received from the Centers for Medicare and Medicaid Services.

The DOJ cited an internal document from Cigna discussing the program, in which the insurer said "[t]he primary goal of a 360 visit is administrative code capture and not chronic care or acute care management." But this was not disclosed to Cigna's plan members when the home visit was scheduled or during the actual visit, the feds allege. When identifying plan members to receive home visits, Cigna focused on people who were likely to yield the greatest risk score increases and thus the greatest increased payment.

The Vendor HCPs, according to the lawsuit, spent limited time with patients and relied largely on their own self-assessments and their responses to basic screening questions. The HCPs typically didn't have access to the patient's full medical history, the DOJ said.

As a result, the 360 home visit program regularly generated false and invalid diagnosis codes for certain serious, complex conditions that cannot be reliably diagnosed in a home setting without extensive diagnostic testing or imaging, the feds charged. 

The DOJ claimed false codes were submitted in "tens of thousands of instances," and that the insurer encouraged HCPs to make diagnoses that translated into higher risk-adjusted payments – tracking the return on investment of the 360 home visit program by comparing the costs of the in-home visits (i.e., payments to vendors) against the additional Part C payments generated by increased risk scores.

THE LARGER TREND

This isn't the only legal trouble in which Cigna has found itself. Just two months ago the insurer was sued for allegedly using algorithms to deny claims.

Filed in California, the lawsuit claims Cigna developed an algorithm known as PXDX to enable its doctors to automatically deny payments in batches of hundreds or thousands at a time for treatments that do not match certain preset criteria. This is evading the legally required individual physician review process, the lawsuit said.

A Cigna Healthcare spokesperson, responding by statement, said the vast majority of claims reviewed through PXDX are automatically paid.

"Claims declined for payment via PXDX represent less than 1% of our total volume of claims," the spokesperson said.

ON THE RECORD

"These agreements fully resolve long-running legal matters, enabling us to focus our resources on all those we serve and avoiding the uncertainty and further expense of protracted litigation," said Chris DeRosa, president of Cigna Healthcare's U.S. government business. "We are pleased to move beyond industry-wide legal disputes related to past risk adjustment practices, and we look forward to continuing to provide high-quality, affordable Medicare Advantage coverage to our customers and delivering value to the taxpayers in the years ahead."
 

Twitter: @JELagasse
Email the writer: Jeff.Lagasse@himssmedia.com