Recently, the DOJ intervened in one of several currently pending qui tam cases involving Medicare Advantage (MA) and the Risk Adjustment process used to determine the amount of payments to Medicare Advantage Organizations (MAO). The government filed its notice of election to intervene in US ex rel. Poehling v. UnitedHealth Group, a case that has been pending in the U.S. District Court for the Central District of California, and which is now unsealed.

The qui tam complaint was filed by Benjamin Poehling, Director of Finance for UnitedHealthcare Medicare & Retirement, a subsidiary of UnitedHealth Group, who alleged substantial personal knowledge of the various practices alleged. The relator’s complaint alleges FCA violations against UnitedHealth, WellMed (a group who allegedly had previously done business with and was acquired by UnitedHealth in 2011), several other MA plans, and MedAssurant (a data analytics company who performed risk adjustment services for several of the plans).

The government intervened only as to certain claims against UnitedHealth and WellMed. It declined to intervene as to other claims against these two entities and as to any claims against the other defendants. The claims against UnitedHealth were derived largely from the conduct of its subsidiary Ingenix, which provided Risk Adjustment Services to UnitedHealth, as well as to several of the other plans.

The claims with respect to which the government intervened included:

  • Against UnitedHealth, as to its Chart Review Program. The relator’s complaint alleged that Ingenix’s retrospective chart reviews for both UnitedHealth and other plans focused only on undercoding not overcoding. Further, it alleged that incremental codes identified were sent to CMS, but no action was taken on identified incorrect codes.
  • Against UnitedHealth as to its Claims Verification Program. The relator’s complaint alleged that in a pilot program to look for both incremental and unsupported codes during chart review, it improperly limited the type of charts reviewed.
  • Against UnitedHealth as to its Chart Validation/Risk Adjustment Coding Compliance Review Program. The relator’s complaint alleged that UnitedHealth improperly limited the charts it would audit without similarly limiting reviews for incremental codes.
  • Against UnitedHealth as to its submission of false Risk Adjustment Attestations referring to attestations submitted by the MA plan to attest that the risk adjustment data submitted to CMS is “accurate, complete, and truthful.” The relator’s complaint also referenced the requirement that such certifications be made by subcontractors.
  • Against WellMed as to its Chart Validation/Risk Adjustment Coding Compliance Review Program and improper diagnosis coding practices. The relator’s complaint alleged WellMed added codes from chart reviews but did not delete incorrect codes. It alleged that where a claim was denied for payment due to fraud, waste and abuse, WellMed would not check for diagnoses submitted based on that claim. The relator’s complaint also alleges that its processing system allows improper codes to be submitted.

The relator’s complaint also makes allegations about the submission of codes derived from radiological services, about the provision of financial incentives and training to providers in a manner that encourages higher risk adjustment, about curing administrative deficiencies—such as lack of a physician signature—in medical records only in order to add a code but not deleting any existing codes if the deficiency is not cured, and sending custom forms and a corresponding payment to members doctors asking them to look for a missing condition that the Ingenix expects the member has based on available data. The government does not appear to have intervened with respect to these claims. Also of note, the relator’s complaint alleges with specificity how UnitedHealth has aligned financial incentives for its entities, staff and vendors to reward higher risk adjustment numbers.

The government’s intervention in Poehling is significant for the managed care industry in that it suggests a rising interest of DOJ in pursuing FCA claims arising from one-sided efforts by plans to document and claim additional diagnoses for their members so as to raise revenue without also making equal effort to ensure the accuracy and validity of the diagnoses they submit in support of their claims for payment. The government is expected to file its complaint-in-intervention by mid-May 2017.