Dive Brief:
- The federal government has filed a lawsuit against New York City and Computer Sciences Corp. alleging the two committed fraud to collect millions of dollars in improper Medicaid reimbursements. The complaint accuses the defendants of increasing the speed and amount of reimbursements by taking advantage of the default settings in Medicaid's billing system between 2008 and 2012.
- The suit deals with children under the age of three with developmental delays or medical conditions like autism in early intervention services. The government is alleging the defendants changed diagnostic codes to a generic code they knew would be paid by Medicaid and that they didn't follow the requirement to exhaust potential secondary private payer sources before submitting claims to Medicaid. The federal government is seeking restitution, civil penalties and triple damages.
- A spokesperson for Computer Sciences told Reuters the lawsuit has no merit and "virtually all" allegations are unsupported. The company, he said, did not submit false claims to CMS. A spokesperson for New York City's Law Department also disagrees with the allegations and told Reuters they believe the issue was a billing one, not one of fraud. Reuters also reported New York state will be bringing a similar case against Computer Sciences.
Dive Insight:
This lawsuit is not the first of its kind for the city. The US Attorney's office in Manhattan filed a complaint in 2011 accusing the city of over-billing Medicaid in relation to home-care patients. The city paid the government $70 million to settle the suit, according to the New York Times. Though there is no number linked to the current lawsuit, the Times reported that false diagnosis data was used on more than 600,000 claims totaling $49 million in payments in just a four-day period in 2009. The suit was originally filed by a whistleblower from Computer Sciences, Vincent Forcier, who would be eligible for 15% to 25% of any funds recovered in the suit.
"CSC and the city created computer programs that systematically, and fraudulently, altered billing data in order to get paid by Medicaid as quickly as possible and as much as possible," US Attorney Preet Bharara in Manhattan said in a statement. "Billing frauds like those alleged undermine the integrity of public healthcare programs like Medicaid."