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A $1 Billion-Plus Violation of the False Claims Act?

South Carolina Medicare Fraud Lawyer

Medicare Advantage insurers may have violated the False Claims Act (FCA) for over $1 billion. In an opinion delivered during August, 2016, the U.S. Court of Appeals for the Ninth Circuit stated that a whistleblower had delivered a convincing case regarding some major Medicare Advantage insurers submitting false claims, which is against the provisions of the FCA. James Swoben, a former employee of a health insurance provider in California and the whistleblower who brought the qui tam case in 2009, alleged that his former employer, SCAN, as well as UnitedHealthcare, HealthCare Partners, and Aetna, had committed fraud by distorting their patients’ health data in order to gain larger payments from the government.

Circuit Judge Raymond Fisher wrote that Swoben “adequately alleged that the defendants’ [Medicare] certifications were false and stated a cognizable legal theory under the False Claims Act.” The ruling has been characterized as enormously important, because Medicare Advantage Plans, also known as Medicare Part C, involve millions of U.S. patients. These patients join because Part C plans often cost less than traditional Medicare combined with supplemental insurance.

Medicare Advantage allows patients, who are usually 65 or older, to sign up for coverage through a private insurance company rather than directly through the Centers for Medicare and Medicaid Services (CMS). In exchange for that, CMS pays a premium for each enrollee to the private insurers. The premium changes according to alterations in “risk adjustment data,” taking into account things like chronic illness which can make the appropriate dollar amount for federal reimbursement go up—or down.

The insurance companies are supposed to conduct regular reviews of the risk adjustment data they submit to CMS. However, whistleblower Swoben alleges that the insurers deliberately set up systems that would catch only the data that would increase their payments, but not catch data or errors that would decrease their payments.

SCAN’s part of the case was settled in 2012 for about $322 million.

But it is alleged that the other insurers named in the case swindled the government out of over $1 billion. This unanimous Ninth Circuit decision reversed a lower court decision to dismiss the case, meaning that the whistleblower case can now go forward.

Although the federal government did not intervene in this case, the Department of Justice (DOJ) did file an amicus or “friend of the court” brief with the Ninth Circuit, indicating their strong interest in the case. The brief contends that the insurers’ behavior alleged by Swoben does violate the False Claims Act. According to the DOJ, Medicare requires insurers to exercise due diligence when it comes to supplying the CMS with accurate data. In the brief, the DOJ wrote, “If a plan has not exercised such diligence – especially where it has implemented record-review procedures specifically designed not to reveal unsupported diagnosis codes – the plan’s certification . . . is ‘false or fraudulent’ under the False Claims Act.”

Working with whistleblowers tirelessly to shed light on fraudulent practices.

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.

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