Independence Blue Cross has agreed to pay $22.5 million to resolve allegations that it used inaccurate diagnosis codes to inflate its Medicare Advantage payments, according to a Sept. 30 Justice Department news release.
The government alleged the insurer violated the False Claims Act in three ways for payment years 2017 through 2021. It says the insurer sent CMS diagnosis codes the records didn’t support, didn’t withdraw inflated codes that led to overpayments and falsely told CMS its data was accurate.
The case centers on IBX’s chart review program. Nurse reviewers went through patient medical records to find every supported condition, and IBX used what they found to send CMS more codes and collect more money. When a review didn’t support a code IBX had already reported, the government says the insurer ignored that result instead of deleting the code and paying the money back.
A former IBX employee brought the whistleblower suit, United States ex rel. Crawford v. Independence Blue Cross, in the U.S. District Court for the Eastern District of Pennsylvania. The whistleblower will receive $3.825 million.
“When insurers knowingly and improperly retain inflated payments based on inaccurate and untruthful diagnoses, we will hold them accountable whether they are a small regional plan or a large nationwide organization,” said Brett Shumate, assistant attorney general of the Justice Department’s Civil Division. Mr. Shumate noted that the government pays private insurers more than $530 billion each year for Medicare Advantage.
The claims are allegations only, and there has been no determination of liability. The Justice Department’s Civil Division, the U.S. Attorney’s Office for the Eastern District of Pennsylvania and HHS’ Office of Inspector General handled the case.
In a statement shared with Becker’s, Independence Blue Cross said it “chose to resolve the matter to avoid the delay, uncertainty, expense, and distraction of prolonged litigation.”
“Many major health plans have faced similar government scrutiny regarding Medicare Advantage risk adjustment requirements and practices, reflecting industry-wide challenges in the application of these standards,” the statement read. “This matter was not about the quality of care our members received. It involved differing views regarding certain documentation and reporting requirements under the Medicare Advantage risk adjustment program.”
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