A whistleblower accused Cigna Corp. of exaggerating the illnesses of its Medicare members in order to obtain higher payments from the federal government, according to a lawsuit unsealed this week.
The lawsuit alleged that Cigna and its Medicare Advantage business HealthSpring violated the False Claims Act by submitting improper diagnostic codes for payment that were based on health conditions that did not exist or were not found in any medical records. As a result, CMS overpaid Cigna by more than $1.4 billion, according to the complaint. The U.S. Justice Department declined to join the lawsuit.
"Cigna-HealthSpring intentionally misrepresented these health conditions as part of a widespread scheme to coax CMS into paying a higher monthly capitated rate on behalf of Medicare beneficiaries enrolled in Cigna-HealthSpring's Medicare Advantage plans," the whistleblower lawsuit, which was filed in the U.S. District Court for the Southern District of New York and unsealed on Tuesday, stated.
"We are proud of our industry-leading Medicare Advantage program and the manner in which we conduct our business. We will actively defend Cigna against unjustified allegations," a Cigna spokeswoman said in an email.
DOJ joined lawsuits alleging similar Medicare Advantage fraud against insurers UnitedHealth Group and Anthem.
The federal government pays Medicare Advantage plans a monthly per-member rate. Those rates are adjusted for the health status of each plan member, among other factors. Advantage members that have more health conditions generally cost more to care for and so, receive a higher "risk score" that translates to higher federal payments. Healthier members receive lower risk scores and thus, the plan receives lower payments. Health plans submit diagnosis codes to CMS for each member, which are used to determine the members' risk scores.
The whistleblower alleged that Cigna started the "360 Program" in 2012 to encourage primary care providers in the insurer's network to perform health assessments on plan members. While Cigna executives said the program was meant to close gaps in care, it was in fact meant to pinpoint health conditions that could raise patients' risk scores and nab extra payments for the insurer, according to the lawsuit.
Cigna executives designed a form that providers were to fill out to document each assessment, the lawsuit alleged. The form allegedly reflected anecdotal health information and clinical data, but the form did not require the provider to state whether the information being reported was anecdotal or clinical. According to the lawsuit, that led to inaccurate diagnoses.
Even though Cigna was aware the 360 program was flawed, it paid primary care providers $150 per completed health assessment and $1,000 to attend training seminars for the program, the lawsuit alleged. Cigna also used third-party contract providers that deployed nurse practitioners to patient's homes to complete the assessments, the lawsuit said.
Though the contract providers told Cigna that the home visit did not replace an annual physician visit and should be reviewed by a doctor, Cigna sent the information to CMS for risk-adjustment without ensuring the conditions were reflected in medical records, according to the lawsuit. The nurse practitioners were not qualified to render diagnoses, and often made diagnoses based on anecdotal evidence, the lawsuit alleged.
Cigna evaluated the contract providers based on how many conditions they could retain or revalidate based on conditions reported in the previous year. Contractors that had high retention rates or produced high risk scores were rewarded, according to the lawsuit.
The complaint alleged that some of the health conditions represented by the diagnosis codes that Cigna submitted did not exist or were not documented in any medical records. In one case, a contractor that was affiliated with Cigna added dementia and chronic obstructive pulmonary disease to a patient's list of conditions, even though a nurse practitioner noted on the 360 form that the patient's mental and respiratory functions were normal, according to the lawsuit.
It alleged that Cigna misrepresented to CMS that certain diagnosis codes were documented during a provider visit. According to the complaint, almost none of the third-party contractors recorded any ICD diagnosis codes in the 360 forms; instead Cigna extrapolated the codes from diagnosis descriptions.
Correction: A previous version of this story incorrectly described the Justice Department's involvement in the whistleblower lawsuit against Cigna, stating that DOJ joined the lawsuit. DOJ declined to intervene in the suit.
