By

Jennifer Haney

20 November 2018

Court Compels Medicare Advantage Plan to Comply With CID for Testimony in Diagnosis Coding Investigation

On November 13, 2018, a magistrate judge issued a report to the United States District Court for the Southern District of New York recommending that the Department of Justice’s (“DOJ”) petition to compel deposition testimony from Anthem regarding its procedures and processes for verifying diagnoses for Medicare Advantage payments be granted and that a date be set for Anthem’s witness to testify.  DOJ is seeking the testimony in connection with its investigation of Anthem as part of its broader enforcement efforts under the FCA focused on the Medicare Advantage program.  (more…)

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07 September 2018

District Court Vacates 2014 Medicare Advantage Overpayment Rule and Curtails Potential Avenues for DOJ to Pursue False Claims Act Damages

On September 7, 2018, the United States District Court for the District of Columbia vacated CMS’s 2014 Final Overpayment Rule,[1] applicable to the Medicare Advantage program, granting summary judgment to UnitedHealthcare that the Final Rule violated the Medicare statute, was inconsistent with the Affordable Care Act (ACA) and the False Claims Act (FCA), and violated the Administrative Procedures Act (APA).  In broad strokes, the District Court confronted two statutory issues.  The first centered on the undisputed fact that the Final Rule did not account for known errors in the data (from traditional Medicare) used to calculate payments to Medicare Advantage plans.  The court found that this failure violates the statutory mandate of “actuarial equivalence” because, although “payments for care under traditional Medicare and Medicare Advantage are both set annually based on costs from unaudited traditional Medicare records,” the Final Rule “systematically devalues payments to Medicare Advantage insurers by measuring ‘overpayments’ based on audited patient records.”  As a result, the court concluded that the Final Rule “establishes a system where ‘actuarial equivalence’ cannot be achieved.”  On the same basis, the court found that the Final Rule violates the statutory requirement to use the “same methodology” in calculating expenditures in traditional Medicare and determining payments to Medicare Advantage plans.  The Final Rule “fails to recognize a crucial data mismatch and, without correction, it fails to satisfy [the Medicare statute].”  (more…)

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28 August 2017

Sixth Circuit Awards Defendant Nearly Half a Million Dollars in Attorneys’ Fees Despite Government’s FCA Victory

The Sixth Circuit recently awarded a defendant $468,704 in attorney’s fees, despite the government winning its FCA suit. The Court found that the defendant was entitled to recover its fees under the plain language of the Equal Access to Justice Act (“EAJA”), even though it was not the prevailing party, because the government’s demand for $1.6 million in damages was “unreasonable” and “substantially in excess” of the final judgment of $14,748.   (more…)

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17 February 2017

Court Rejects Armstrong’s Motion for Summary Judgment, ignoring Escobar, and Sets the Case for Trial Where Armstrong Faces Nearly $100M in Damages

On February 13, 2017, the District Court for the District of Columbia rejected motions for summary judgment filed by cyclist Lance Armstrong and his agents Capital Sports and Entertainment Holdings Inc. (CSE) in an FCA suit alleging the defendants violated the FCA by issuing payment invoices to the United States Postal Service (USPS) under sponsorship agreements while actively concealing Armstrong’s use of performance enhancing drugs (PEDs).  The Court rejected Armstrong’s motion because it found that the government raised genuine issues of fact regarding the applicability of two of its three theories of FCA liability, its common-law claims, and the issue of actual damages.  As a result, the Court will set the case for trial, where Armstrong may face nearly $100M in damages.  A copy of the court’s order can be found here.

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