$8M Qui Tam Win: Whistleblower Exposes Cigna’s False Claims Act Violations

January 8, 2024
$8M Qui Tam win: Whistleblower exposes Cigna's False Claims Act violations

Cigna recently came under scrutiny for allegedly violating the False Claims Act by submitting inaccurate diagnoses for its Medicare Advantage Plan enrollees and failing to rectify them, thereby attempting to increase its payments from Medicare which constitutes Medicare fraud. This matter was resolved when Cigna agreed to a settlement, agreeing to pay over $172 million. The relator who brought the claim is set to receive over $8 million as a whistleblower reward under the False Claims Act.

$8M Qui Tam Win: Whistleblower Exposes Cigna’s False Claims Act Violations

Medicare Advantage Overview

Medicare Advantage (“MA”), established as Part C of the Medicare Act, operates as a public-private program providing eligible individuals with access to government-subsidized health benefits through private insurance plans.

Framework of The Medicare Advantage Program

Within the Medicare Advantage (MA) Program, often referred to as Medicare Part C, individuals covered by Medicare can choose to receive their Medicare-covered benefits through private insurance plans, known as MA Plans. These plans receive fixed monthly payments from the Centers for Medicare and Medicaid Services (CMS) for each enrolled beneficiary. CMS adjusts these payments based on various “risk” factors, considering expected health expenditures for each beneficiary. This adjustment ensures that MA Plans receive higher compensation for beneficiaries with anticipated elevated healthcare costs and lower compensation for those with expected lower costs. To facilitate these adjustments, CMS collects “risk adjustment” data, including medical diagnosis codes, from the MA Plans.

Case Details

The Cigna qui tam case centers on specific patient encounters within Cigna’s 360 program. This program involves annual comprehensive health risk assessments for Cigna’s MA plan members, conducted by their primary care providers (“PCP”). In instances where individuals who are homebound may not see their PCP each year, in-home 360 exams guarantee that members are seen at least once a year by a licensed provider during their visit.

Alleged Detailed False Claims Act Violations by Cigna

The allegations against Cigna, a private health insurance company, are about the characterization of inaccurate patient diagnosis data to the Centers for Medicare and Medicaid Services (CMS), which resulted in inflated reimbursements to CIGNA’s. When a private entity defrauds the federal government, a private individual can bring the government’s attention to the misconduct through the False Claims Act and in turn receive a whistleblower reward of up to 30%.

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Chart Review Program Implementation

During the specified payment years from 2014 to 2019, Cigna executed a “chart review” program. This initiative involved retrieving medical records, referred to as “charts,” from healthcare providers detailing services provided to Medicare beneficiaries enrolled in Cigna’s plans. Cigna employed diagnosis coders to thoroughly assess these charts, by identifying all supported medical conditions and assigning diagnostic codes to beneficiaries for these conditions.

Cigna allegedly strategically manipulated the outcomes of these chart reviews. The health insurance company submitted additional diagnosis codes to CMS that healthcare providers had not reported. The aim was to secure extra payments from CMS based on the identified medical conditions.

However, certain diagnosis codes reported by both healthcare providers, as well as Cigna to CMS were not substantiated by the results of chart reviews. Surprisingly, Cigna did not take corrective action despite the lack of validation. There was a failure to rectify or retract these inaccurate and misleading diagnosis codes, which would have obligated Cigna to reimburse CMS if corrected. The United States alleged that Cigna selectively utilized the results of its chart reviews. It pinpointed situations to seek additional payments from CMS while neglecting to address instances where Cigna had been overpaid based on the same results.

Submission Based on In-Home Assessments

Additionally, Cigna allegedly submitted diagnosis codes to CMS solely based on forms completed by vendors retained and compensated by the company. These vendors conducted in-home assessments of plan members, who were often nurse practitioners. Importantly, during these home visits, necessary diagnostic testing, and imaging for serious and complex conditions did not have tests performed or ordered. In many instances, these healthcare providers were prohibited by Cigna from providing any treatment during the home visits for the medical conditions they purportedly identified.

Lack of Support and False Certification

The diagnoses in question allegedly lacked support from the information documented on the forms completed by the vendors. Furthermore, no other healthcare provider who saw the patient during the year of the home visit reported these diagnoses to Cigna. Despite these discrepancies, Cigna submitted these diagnoses to CMS to claim increased payments and falsely certified each year that the diagnosis data provided was “accurate, complete, and truthful.”

Qui Tam Filing and Case Developments

On October 2, 2017, the relator initiated a qui tam action under the False Claims Act in the Southern District of New York. The allegations involved violations concerning:

Data Gathering Exercise:

The diagnoses reported by Cigna to CMS for payment allegedly originated during home visits designed as “data gathering exercises” rather than legitimate medical encounters. Providers were purportedly “prohibited” from delivering medical care during these visits.

Inability to Treat or Assess:

The diagnoses supposedly covered certain conditions that “could not have been treated or assessed during 360 visits.”

Lack of Medical-Record Support:

Some diagnoses allegedly “lacked medical-record support or otherwise violated CMS coding rules.”

The government initially declined to pursue the first theory and chose not to intervene on behalf of

Court’s Conclusion and Whistleblower Settlement

The civil settlement addressing the home visit allegations includes resolutions under the qui tam or whistleblower provisions of the False Claims Act by the relator also known as a whistleblower. The qui tam case is identified as United States ex rel. Cutler v. Cigna Corp., et al., No. 3:21-cv-00748 (M.D. Tenn.). As part of this resolution, the relator is set to receive over $8 million from the settlement of the home visit allegations as a whistleblower reward. If you are aware of Medicare fraud with the Medicare Advantage program or any other false billing to the government you are encouraged to speak with a whistleblower attorney to learn your rights.