The biggest provider of Medicare Advantage plans in the U.S., United Healthcare (UNH), is being sued in a qui tam whistleblower suit that has been joined by the Department of Justice (DOJ). The suit is so big that the share price of United Healthcare, a member of the Dow Jones Industrial Average, actually dropped enough to drag the DJIA down after the lawsuit was announced. The case was made public in mid-February, 2017.
Supposedly, in 2010, United Healthcare instituted an upcoding scheme known as “Project 7,” its aim being to increase operating income by as much as $100 million. A whistleblower filed suit under the False Claims Act (FCA) in 2011. The accusations involve Medicare Advantage (MA), which is a program for Medicare enrollees who agree to join HMOs (health maintenance organizations), which limit choices but generally have lower premium costs and lower out-of-pocket costs. The government reimburses the insurance company offering the MA plan for certain costs, which is why the premiums are low. MA was created in 2003.
The Allegations in the Case
“Project 7” was supposed to ensure the receipt of bigger payments under Medicare Advantage’s risk adjustment program, known as HCC-RAF. The original whistleblower complaint claims that United Healthcare fraudulently collected hundreds of millions, possibly billions, of dollars because the company claimed under HCC-RAF that patients were sicker than they actually were. The suit was filed in 2011 by a former finance director for UNH.
The alleged scheme worked as follows: UNH instructed medical coding personnel to code patients with diagnosed high-risk and long-term health conditions for higher-cost medical procedures. These patients had their records “mined” for their conditions, but no in-person verification was done by UNH personnel before coding was changed. It is also claimed that UNH told contracted provider groups that they would receive incentives if patients were medically coded for conditions that were more serious that the ones they were diagnosed for.
Medical codes are how health care insurers, including government programs like Medicare, Medicaid, and TRICARE, determine how much they will pay for an office visit or procedure. Each code has a dollar amount attached to it.
The original suit named 15 insurers. However, the DOJ intervened only in the FCA violations case involving United Healthcare and its subsidiary, Ingenix (now named OptumInsight), UNH’s health care data analytics business unit.
Why has it taken so long for the false claims case to become public? Simple—the government sealed the case for five years (the usual sealing time is 60 days) so that the Department of Justice could investigate.
United Healthcare Objects
UNH, which covers about 2.2 million Medicare Advantage patients, has denied the allegations, insisting that the claims are based on an erroneous interpretation of Medicare rules. Matthew A. Burns, a spokesman for United Healthcare, said, “We reject these more than five-year-old claims and will contest them vigorously.” Burns added that UNH was “proud of the access to quality health care we provided, and confident we complied with the program rules.”
What Might Be the Outcome?
Government payments are the heart of the issue—insurance companies and the federal government have been sparring for years over billings and procedures.
Payments are sometimes adjusted upward for patients with more serious health problems. The rules for such risk adjustments—riskier heath situations generally require more funds—have long been controversial and problematical. Still, the case will hinge on whether UNH abided by the rules or whether it actually upcoded, thereby opening itself up to the charge of false claims under the FCA.
Making a difference.
If you think you have the facts needed to bring a whistleblower case, the experienced whistleblower attorneys at the Louthian Law Firm can review your case and help you file the appropriate disclosure statement. Under some circumstances, the government will intervene, or join in your lawsuit.
Your chances of succeeding are greater if your whistleblower claim is substantive, clear, and to the point. Because of this, meeting with a qualified whistleblower attorney can increase your chances of winning. The Louthian Law Firm can help you form your claim so that the government will be more inclined to intervene in your case; government intervention can sometimes increase the chances of recovering reward money. Even if the government decides not to intervene, it could still be a good idea to pursue your case without government involvement. Our strong support system can assist you through every step of the process.
For a free, confidential evaluation of your case, call the Louthian Law Firm today at 1-803-454-1200 or, if you prefer, you can fill out our online contact form.