DOJ sues Cigna over alleged Medicare Advantage overpayments

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The Department of Justice has filed a civil lawsuit against Cigna and its Medicare Advantage subsidiaries alleging that it sought to boost its reimbursement by submitting false and inaccurate Medicare Advantage diagnostic codes.

The lawsuit seeks damages and penalties under the False Claims Act for the submissions, which the DOJ claims was used to artificially inflate the payments Cigna received for its MA coverage. The government is intervening in a lawsuit initially filed by a whistleblower, which was originally filed in the United States District Court for the Southern District of New York and later transferred to the Middle District of Tennessee.

Specifically, the complaint alleges 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, the DOJ said. 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."

"Cigna knew that, under the Medicare Advantage reimbursement system, it would be paid more if its plan members appeared to be sicker," said U.S. Attorney Damian Williams by statement.

WHAT'S THE IMPACT

The home visits under Cigna's "360 comprehensive assessment" program, typically conducted by nurse practitioners and on occasion by other non-physician 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.

For example, according to an internal report, Cigna determined that, during the first nine months of 2014, one vendor's 6,658 in-home visits resulted in more than an additional $14 million in Medicare payments, which dwarfed the approximately $2.13 million that Cigna paid to the vendor.  When specific providers were found to have captured fewer diagnoses than expected, Cigna asked the vendor to prepare a "performance improvement plan" for the provider.

CIGNA'S RESPONSE

The insurer submitted a statement in response to the government's allegations.

"We are proud of the high-quality, affordable Medicare Advantage benefits we are privileged to provide to beneficiaries nationwide in compliance with government rules," a Cigna spokesperson said. "We reject these allegations and will vigorously defend our Medicare Advantage business against them. Our focus remains on serving our Medicare customers and advancing our mission of making healthcare more affordable, predictable, and simple for all."

THE LARGER TREND

Medicare Open Enrollment began on Oct. 15 and runs through Dec. 7, and the Biden administration is claiming that people with Medicare will see lower average premiums for Medicare Part B, Medicare Advantage and Medicare Part D prescription drug plans in 2023.

The White House attributed this in part to the Inflation Reduction Act, which President Biden signed into law in August.
 

Twitter: @JELagasse
Email the writer: jeff.lagasse@himssmedia.com