Complete Health Partners Holdings, headquartered in Jacksonville, Florida, has agreed to pay $14,100,000, to resolve allegations that they violated the False Claims Act by causing the submission of false diagnosis codes in order to increase payments that they received from the Medicare Advantage program.
“As the Medicare Advantage program continues to grow, providers who participate in the program must be held to account when they attempt to improperly profit at the taxpayer’s expense,” said Assistant Attorney General Brett A. Shumate of the Justice Department’s Civil Division. “This settlement reflects the Department’s commitment to protecting taxpayer money and ensuring that Medicare payments are based on information that is true and accurate.”
“Health care fraud enforcement has long been a cornerstone of the mission of this office,” said U.S. Attorney Gregory W. Kehoe for the Middle District of Florida. “This settlement sends a strong message to our district, its residents, and medical providers doing business here, that our focus on this vital practice area has not wavered.”
“Companies that attempt to improperly boost their own profits by reporting bogus medical conditions of Medicare Advantage enrollees — as alleged in this case — will be held responsible for their actions,” said Special Agent in Charge Isaac M. Bledsoe of the Department of Health and Human Services Office of Inspector General (HHS-OIG). “Today’s settlement demonstrates our office’s commitment to safeguarding the integrity of federal health care programs, including Medicare Advantage, which exist to provide necessary care to enrollees, not as a vehicle for improper financial gain.”
Under the Medicare Advantage (MA) Program, also known as Medicare Part C, Medicare beneficiaries may opt out of traditional Medicare and enroll in private health plans offered by insurance companies known as Medicare Advantage Organizations, or MAOs. The Centers for Medicare & Medicaid Services (CMS) pays the MAOs a fixed monthly amount for each Medicare beneficiary enrolled in their plans. CMS adjusts these monthly payments to account for various “risk” factors that affect expected health expenditures for the beneficiary. In general, CMS pays MAOs more for sicker beneficiaries expected to incur higher healthcare costs and less for healthier beneficiaries expected to incur lower costs. To calculate the payment amounts, CMS uses a health-based risk adjustment model — the Hierarchical Conditions Category (HCC) model — that takes into account diagnoses reported by healthcare providers. In general, the more severe the diagnosis or costly the associated treatment, the higher the risk score and the higher the corresponding payments to the MAO.
Complete Health Partners Holdings (Complete Health) is a management services organization that manages, owns or otherwise operates affiliated provider groups operating out of Florida, Alabama and Colorado. Under the contracts, the MAOs agreed to pay Complete Health a percentage of the payments they received from CMS. This “risk sharing” compensation arrangement gave Complete Health a financial incentive to submit additional diagnosis codes to increase its patients’ risk scores and the corresponding payments made by CMS.
The settlement resolves allegations, from 2020 to 2023, Complete Health submitted diagnosis codes within Hierarchical Condition Code (HCC) 55 (Drug and Alcohol Dependence) and HCC 59 (Major Depressive, Bipolar, and Paranoid Disorders) that were not clinically valid, not properly supported by the beneficiary’s medical records, and/or not considered in the care, management, or treatment of the beneficiary.
The United States contends that Complete Health disseminated incorrect coding guidance to its coders and physicians regarding diagnosis codes within HCC 55 and HCC 59. The United States further contends that Complete Health coders reviewed its beneficiaries’ medical records and identified additional diagnosis codes for chronic conditions, including diagnoses within HCC 55 and HCC 59. Complete Health then prompted doctors to add those diagnosis codes, even when the diagnosis codes were unsubstantiated or not clinically justified. As a result, the doctors added those diagnosis codes, which were not accurate. These diagnoses resulted in an increase in payment from CMS to the MA Plans in which the beneficiaries were enrolled, and the MA Plan then passed along a portion of the increased payment to Complete Health.
The civil settlement resolves claims brought under the qui tam or whistleblower provisions of the False Claims Act by Karen Bowers, former Associate Director of Risk Adjustment at VIVA Health. Under those provisions, a private party can file an action on behalf of the United States and receive a portion of any recovery. The qui tam case is captioned United States ex rel. Karen Bowers vs. Complete Health Partners, Inc., Pharos Capital Group, LLC, Viva Health Inc., and Blue Cross and Blue Shield of Alabama, Civil Action No. 3:22-cv-463 (M.D. Fla.). Karen Bowers will receive approximately $2,467,500 as her share of the federal recovery.
This year the Administration launched the Task Force to Eliminate Fraud and the National Fraud Enforcement Division to enhance the administration’s war on fraud, waste, and abuse in federal programs. When unscrupulous actors exploit these programs for their own financial gain, they defraud the government, harm the people these programs are designed to aid and protect, and undermine American businesses that play by the rules. The Civil Division’s FCA enforcement plays a critical role in combatting such fraudulent schemes, recovering billions of dollars for the American taxpayers, and holding wrongdoers accountable. FCA matters will continue to be on the forefront of the battle against fraud, and the Civil Division’s FCA work will support and advance the mission of the Task Force to Eliminate Fraud and the National Fraud Enforcement Division.
The resolution obtained in this matter was the result of a coordinated effort between the Justice Department’s Civil Division, Commercial Litigation Branch, Fraud Section, and the U.S. Attorney’s Office for the Middle District of Florida, with assistance from the Department of Health and Human Services Office of Inspector General.
The investigation and resolution of this matter illustrate the government’s emphasis on combating healthcare fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse, and mismanagement, can be reported to the Department of Health and Human Services Office of Inspector General at 800-HHS-TIPS (800-447-8477).
The matter was investigated by Fraud Section Attorneys Olga Yevtukhova and J. Jennifer Koh and Assistant U.S. Attorneys Sean Keefe and Collette Cunningham for the Middle District of Florida.
The claims resolved by the settlement are allegations only and there has been no determination of liability.
