The recently filed federal whistleblower lawsuit alleging that tens of billions of dollars in improper payments were made to insurers by Medicare Advantage over the course of several years could be just the tip of the iceberg, according to the attorneys for the plaintiff in the case.

The suit was filed under the False Claims Act by Benjamin Poehling, a Minnesota resident who once worked for UnitedHealth Group (UHG). In an interview exclusive to RACmonitor, the attorneys representing Poehling in the case, Mary Inman and Tim McCormack of the law firm Constantine Cannon LLP, explained some of the details regarding their client’s allegations – including the fact that widespread misconduct on the part of some of the nation’s largest healthcare insurers may remain ongoing.

“Although some health plans are trying to be more compliant, risk adjustment fraud remains widespread because unscrupulous health plans have so much to gain financially,” the pair wrote in response to questions sent via email. “Judging from the references in the Government’s filings in this case to an active investigation of risk adjustment practices at UHG’s competitor health plans, we are likely to see more revelations about fraud in the risk adjustment arena in the future.”

Inman and McCormack noted that Poehling’s lawsuit only addresses UnitedHealth’s risk adjustment practices from 2007 through 2012, when he left the company. During that period, they added, although individual risk adjustment programs and practices changed, the fundamental alleged misconduct continued.

At the heart of the issue, as the New York Times reported when it broke the story earlier this month, was not only that finance directors like Poehling allegedly managed projects designed to make patients look sicker than they were by scouring patients’ health records electronically and finding ways to manipulate diagnosis codes, but also that bonuses were issued when teams hit their revenue targets – but not when patients saw better health outcomes or the accuracy of patient charts improved.

“A key takeaway here is that UHG’s national chart review program only looked for conditions that risk-adjusted,” Inman and McCormack said. “If it didn’t risk-adjust, UHG didn’t look for it, regardless of how serious a condition it was.”

The two attorneys confirmed that Poehling’s decision to file his lawsuit wasn’t an easy one, and commented generally on the prospect of more plaintiffs like him coming forward.

“Mr. Poehling tried for several years to change the system from within, but later came to believe that UHG ultimately was not going to fix the problems, despite (his) best efforts,” they said. “Whistleblowers need to be prepared for the long haul. Whistleblowing is not an easy process, even when you bring forward incredibly detailed and sophisticated information like Mr. Poehling did here.”

“It takes the Government a long time to investigate these cases. It is an arduous process to help the Government get to the finish line,” they added. “Filing the complaint is just the beginning.”

The New York Times report quoted a spokesman for UnitedHealth, Matthew A. Burns, who denied any wrongdoing on the part of the company.

“We are confident our company and our employees complied with the government’s Medicare Advantage program rules, and we have been transparent with CMS (the Centers for Medicare & Medicaid Services) about our approach under its murky policies,” Burns was quoted as saying.

As a whistleblower, under federal law Poehling would earn a percentage of any funds recovered should his lawsuit prevail. Much of the remainder would be returned to CMS.

Duane C. Abbey, a coding and compliance expert with Abbey & Abbey Consultants, Inc., said he wasn’t surprised by Poehling coming forward, adding that he expects U.S. Sen. Chuck Grassley (R-Iowa) to champion the issue in Congress.

“Medicare Advantage, Part C, is a complex program that has become quite popular. From the Medicare beneficiary’s perspective, Medicare Advantage programs offer superior coverage for reasonable costs,” Abbey explained. “For providers, such as physicians and hospitals, circumstances become more complex in that a provider may be in or out of a given network that is associated with a Medicare Advantage Organizations (MAOs). There can also be technical claims adjudication challenges.”

The highest degree of complexity, Abbey noted, is with the risk adjustment used by CMS to make extra payments to the MAOs for sicker patients or patients with multiple chronic conditions.

“The determination of the risk adjustment factor is diagnosis-driven. Careful auditing is routinely required to make certain the risk adjustment factor is being properly determined,” he said. “These are the RADV audits, or risk adjustment data validation audits. Concern has grown since 2010 that there are only limited audits and the amount of recoupment is well below what it could be – while estimates vary, the amount of overpayment could easily be in the billions of dollars per year.”

Christopher Sprenger, president and owner of the North Carolina-based SanStone Health and Rehabilitation Co., which includes 14 facilities, echoed the notion that this lawsuit could just be the beginning.

“This focuses on what UnitedHealth gets paid from CMS, but there is potentially a bigger story about how they do everything in their power to minimize what they pay providers, such as my company,” Sprenger said. “UnitedHealth (and others) contract with CMS to provide an alternative to traditional Medicare. They get paid a stipend to do this – call it ‘privatizing’ a portion of what CMS and Medicare traditionally do.”

Sprenger said insurers use “every tactic in the book” to deny payments, including stalling, nitpicking paperwork, playing games with deadlines, and more. 

“Most patients that enter a skilled nursing setting don’t even realize that they signed up for it. They certainly don’t know that their co-pays are wildly different and benefits far inferior to traditional Medicare SNF (skilled nursing facility) benefits,” Sprenger added. “UnitedHealth and other Medicare replacement plans not only bilk Medicare, but the providers they are to pay.”

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