A whistleblower in Texas has brought a lawsuit against former employer CenseoHealth LLC and numerous Medicare Advantage Organizations alleging they overcharged Medicare for in-home patient care.
Plaintiff and former Censeo Coding Manager Becky Ramsey-Ledesma of Texas has demanded a jury trial, according to court documents filed with the U.S. District Court of Texas. So far, no trial date has been set.
The court documents were ordered unsealed by the court on June 17 after the United States Department of Justice declined to intervene in the civil action, according to Judge Barbara Lynn.
In a released statement, CenseoHealth stated, "Given our commitment to the highest ethical standards, we were pleased when after conducting a detailed investigation of the qui tam lawsuit, the Department of Justice, in June, decided not to intervene in a lawsuit filed against the company by a former employee relating to the company's in-home assessment program. If the former employee decides to take the case forward, notwithstanding the government's refusal to join in the lawsuit, we are confident that the evidence will continue to show that the company acted properly and legally."
CenseoHealth is proud of the work we do on behalf of health plans and their Medicare recipients and is committed to full compliance with federal law and to operating under the highest ethical standards.
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Ramsey-Ledesma claims Censeo knew diagnoses of patients were not supported by medical record documentation, but were "picked up" from diagnoses predicted by medications used, according to court documents.
"If a prescribed medication could potentially support a diagnosis, they were to code for that diagnosis," according to the lawsuit.
Ramsey-Ledesma claims Censeo Chief Medical Officer Mark Dambro developed an evaluation process designed to maximize the capitated payment rates paid to Censeo's client Medicare Advantage Organizations.
Rather than rely on medical records provided by physicians treating patients, the plaintiff alleges Censeo obtained self-reported data directly from certain MAO members, according to court documents. The data was collected through evaluation forms completed by physicians retained by Censeo, not for the purpose of treatment, but to create ICD-9 codes for submission to the Centers of Medicare and Medicaid Services, according to the lawsuit.
Censeo targeted those MAO plan members who were likely to yield the most serious diagnoses, and more likely to generate higher capitation payments for Censeo's MAO clients, the lawsuit states.
Medicare Advantage plans get higher rates for patients who are sick than those in good health.
The company completed twice as many assessments in 2013 as it did in 2012, saying its clients propelled the company into a record-setting first quarter, increasing the number of evaluations by 250 percent, according to the lawsuit.
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Revenue growth for 2013 was projected to reach $120 million, a 140 percent year-over-year increase, according to court records.
Censeo contracted with at least 30 MAOs to provide the home assessments, including Blue Cross Blue Shield in several states and Humana, which are both named as defendants.
Defendants include: CenseoHealth LLC, Mark Dambro, Chief Compliance Officer James Edward Barry Greve Jr., Director of Quality Joy Ridlehuber, Altegra Health Inc., Blue Cross Blue Shield Alabama, Blue Cross of Idaho, Blue Cross Blue Shield Tennessee, Care Plus Health Plans Inc., Chinese Community Health Plan, Commonwealth Care Alliance, Community Health Plan of Washington, Coventry Health Care Inc., Health Net Inc., Highmark Blue Cross Blue Shield, Hill Physicians Medical Group Inc., Humana, Inc., and North Texas Specialty Physicians.
Ramsey-Ledesma said she was fired August 9, 2013, after advising coders she would code only those diagnoses that could be supported by a doctor's assessment.
CenseoHealth said whistle blower suits in general can be motivated by financial gain.
"Federal law authorizes individuals to file lawsuits (called qui tam actions) alleging that fraud has been committed against the government and receive a portion of any recovery if there is one. The U.S. Department of Justice is required to investigate the allegations and may intervene in the lawsuit if it believes the lawsuit has merit. Because of the prospect of a reward, qui tam actions are frequently filed against companies operating within the health care industry."
This case is among several whistleblower cases filed alleging billing fraud of Medicare Advantage plans. CMS has said in the past it suspects home visits improperly raise risk scores.
In July, the Center for Public Integrity published a report of government audits showing widespread billing errors -- mostly overcharges -- in private Medicare Advantage health plans.
The audits involved five health plans: Aetna Health Inc. in New Jersey; Independence Blue Cross in Philadelphia; Lovelace Health Plan in Albuquerque, N.M.; Care Plus, a division of Humana, South Florida; and PacifiCare in Washington State, an arm of UnitedHealth Group, and considered the nation's largest Medicare Advantage plan.
Among the findings: Medicare paid the wrong amount for 654 of the 1,005 patients in the sample, an error rate of nearly two-thirds. The payments were too high for 579 patients and too low for 75 of them. The total payment error topped $3.3 million in the sample.
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Auditors concluded that risk scores were too high for more than 800 of the 1,005 patients, which in many cases, but not all, led to hefty overpayments.
Auditors could not confirm one-third of the 3,950 medical conditions the health plans reported, mostly because records lacked "sufficient documentation of a diagnosis." The names of the medical conditions were redacted by federal officials.The federal Centers for Medicare and Medicaid Services, which conducted the audits, had no comment, according to the Center for Public Integrity.
None of the health plans would discuss the audit findings.
Aetna, in a statement, said the company had "raised a number of questions and concerns" regarding the results and was "awaiting a response from CMS."
Clare Krusing, a spokeswoman for America's Health Insurance Plans, the insurance industry's primary trade group, said the audits "overstated" the payment errors, according to the nonprofit and nonpartisan investigative news organization. The records are coming to light at a time of rapid expansion – and consolidation--in the Medicare Advantage market. Enrollment has neared 17 million. An estimated one of every three people are eligible for Medicare.
Twitter: @SusanMorseHFN