Dive Brief:
- Monogram Health has agreed to pay $2.4 million to settle allegations that it submitted unsupported diagnosis codes and overcharged Medicare through the privatized Medicare Advantage program, the Justice Department said Monday.
- The Tennessee-based home care company allegedly submitted inaccurate or medically unsupported diagnosis codes to insurers from 2021 through 2023, causing the CMS to pay Medicare Advantage plans more, according to the DOJ.
- The settlement resolves some claims in a whistleblower suit filed by Dr. Ajay Gupta, a former Monogram nephrologist and regional medical director. The unsealed complaint identifies Cigna and Humana as the Medicare Advantage insurers that contracted with Monogram, although neither company is a party to the settlement, Ciaran McEvoy, a public affairs officer for the U.S. Attorney’s Office for the Central District of California, told Healthcare Dive.
Dive Insight:
In Medicare Advantage, the CMS pays private insurers a fixed amount for each member every month, adjusted based on the expected cost of that person’s care. Diagnosis codes associated with more serious conditions raise a beneficiary’s risk score — and the insurer’s reimbursement.
Providers can share in those payments through risk-based contracts. Monogram, which delivers in-home care to people with complex and chronic conditions, was eligible to receive more money under contracts with Medicare Advantage insurers when its patients had higher risk scores, according to the DOJ.
That structure gave Monogram a financial incentive to submit unsupported diagnosis codes, the government says, a practice called “upcoding.” The company allegedly submitted codes for protein-calorie malnutrition, substance use disorder, coagulation and other blood disorders, and angina that were clinically inaccurate, unsupported by patients’ medical records or did not require or affect patient care.
The codes increased beneficiaries’ risk scores and caused the CMS to pay Medicare Advantage organizations more than it otherwise would have, according to the settlement. Monogram will pay $2.4 million plus interest, including about $1.4 million in restitution. Gupta will receive $386,225 from the recovery under the False Claims Act’s whistleblower provisions.
The DOJ settled only the claims against Monogram involving the covered coding conduct and dismissed the complaint’s other claims and parties without prejudice, McEvoy said. The claims resolved by the settlement are allegations only, and there has been no determination of liability.
Monogram declined to comment. Counsel for Gupta did not respond to a request for comment by publication time.
The case is the latest provider-side enforcement action targeting upcoding Medicare Advantage. Earlier this month, value-based primary care provider Complete Health agreed to pay $14.1 million to settle allegations that it submitted unsupported diagnoses to increase payments from 2020 through 2023.
Scrutiny into Medicare Advantage is intensifying as the CMS accelerates audits of health plans. The federal government is expected to spend $76 billion more on Medicare Advantage beneficiaries this year than if the same people were enrolled in traditional Medicare.
