Independence Blue Cross settled a Medicare Advantage false claims suit for $22.5 million
The federal government's settlement with IBX followed May's $117.7 million settlement with Aetna, another significant Medicare Advantage insurer in the Philadelphia region.
Independence Blue Cross, Philadelphia’s largest Medicare Advantage insurer, agreed to pay $22.5 million to settle a whistleblower lawsuit alleging that the company submitted inaccurate diagnoses for enrollees to increase payments, the U.S. Attorney for the Eastern District of Pennsylvania said Wednesday.
The IBX settlement, like several others this year, centers on how private Medicare insurers evaluate the health of the individuals in their plans, a process known as risk adjustment. The government gives insurers more money for sicker patients.
“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,” Independence said in an email. The company did not admit wrongdoing.
Federal officials said that for five years ending in 2020, IBX used nurses to review patient records and look for additional medical conditions that could be submitted to regulators. That generated additional payments for the insurer under Medicare Advantage’s risk adjustment models.
According to the government, the chart reviewers also found diagnoses that were not supported by the patients’ records, but IBX failed to withdraw those diagnoses. Had the company done so, it would have had to return money to the Centers for Medicare and Medicaid Services.
“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,” Independence said in an email.
IBX’s settlement followed an agreement in May by Aetna, the Philadelphia region’s second-largest Medicare Advantage insurer, to pay $117.7 million for coding violations.
Nationally, two settlements this year topped half a billion dollars. Kaiser Permanente, a California-based insurance company with a large hospital business, agreed to a $556 million settlement in January, and Villages Health System LLC, a Florida provider group, settled for $541.5 million.
The whistleblower, a former IBX employee, will collect $3.8 million of the settlement amount. Government and company officials signed the settlement Sept. 11.
