UnitedHealth Group, Inc. vs. the United States of America: The case for CDI

Part 4 (click here to view part 1, click here to view part 2, and click here to view part 3)

By Brian D. Murphy

In Part 1 of this series I introduced the developing story of UnitedHealth Group, Inc. vs. the United States of America. In Part 2, I detailed the facts of the case. Part 3 looked at the regulations and commentary regarding claims submission to Medicare Advantage and the ramifications for CDI. Part 4, discusses recent developments of the case.

Since I wrote my initial three parts of the developing case of UnitedHealth Group, Inc. vs. the United States of America there has been a huge development on the legal front. Round 1 of the case of UnitedHealth Group, Inc. vs. the Unites States of America is over, and the decisive winner (at least in the matter of one complaint filed by the DOJ) is United.

In a story reported by Modern Healthcare on October 6, U.S. District Judge John Walter in California stated that the DOJ’s False Claims Act (FCA) allegations against United and its affiliates were “too vague to move forward” and ordered them dismissed. Jeff Overley from Law360 writes of the decision, “According to Judge Walter, the suit is too vague, doesn’t show intentional wrongdoing, and doesn’t show that the government would have withheld payment if it had been aware of the alleged violations.”

Judge Walter withheld no criticisms of the case lodged by the DOJ. In essence, he called the complaint a case of “classic shotgun pleading,” or a series of individual examples without a unifying, underlying intent to defraud—the latter being a key component of an FCA allegation. Judge Walter says that Medicare may have made the payments regardless of any aggressive record review process by United. He also stated that the DOJ failed to show that United knowingly submitted false data to the government. Again from Law360:

In addition, Judge Walter said the DOJ failed to show that UnitedHealth knowingly submitted bogus data to the government, as required to prove FCA liability. According to Judge Walter, the complaint “failed to identify anyone” at UnitedHealth who knew that submitted data was faulty.

Judge Walter stated that the DOJ could refile an amended complaint with strengthened allegations, should it choose to do so. But in another recent development the DOJ said it would not, according to a report in Modern Healthcare on Oct. 16.

So is it case closed for the DOJ? Possibly. But perhaps not.

Certainly the DOJ has more work to do to prove its case. As the Modern Healthcare article notes, the bar for the DOJ to prove another FCA violation by UnitedHealth has been raised. It was not clear that UnitedHealth employees knew about the upcoding, and its possible CMS would have paid UnitedHealth for the claims regardless. The diagnoses coders picked up were documented once by physicians, albeit at an earlier date, and may very well have been valid for reporting.

But based on what I’ve read, and the number of whistleblowers involved in similar suits concerning Medicare Advantage claims, it’s possible DOJ could continue to pursue legal action.

In addition—and this is a key point in what is a multi-layered, complex case—Judge Walter’s dismissal concerns only the complaint of U.S. ex rel. Swoben v. Scan Health Plan et al., case number 2:09-cv-05013, in the U.S. District Court for the Central District of California.

I have been largely reporting on a second, separate FCA lawsuit filed against United by the DOJ on behalf of whistleblower Benjamin Poehling, which can be found here. This latter case appears to be open and pending and I have written the DOJ for clarification.

In the wake of the DOJs decision to not refile the Swoben case, United (as reported by FierceHealthcare on Oct. 19) has asked a federal judge to scrap CMS’ 2014 Medicare Advantage Overpayment Rule altogether. United’s lawyers are claiming it is inconsistent with rules regarding validation criteria and overpayments under the traditional Medicare program, and is therefore unlawful.

In an interesting legal argument, United claims that an obligation to delete “invalid” diagnosis codes prior to submission to Medicare Advantage—for example, codes don’t that appear to be supported by physician medical record documentation—can result in the same patient receiving two different risk scores (a lower risk score in Medicare Advantage, a higher risk score under Medicare’s separate actuarial model, which also uses diagnoses codes).

United argues that Medicare Advantage organizations are, in short, held to an arbitrarily higher, unfair standard than traditional Medicare fee-for-service contractors. Says United:

CMS can draw no support, either, from guidelines stating that diagnosis codes should reflect diagnoses documented in medical charts. That principle is not a regulatory requirement applicable uniquely to MA plans—it is an industry-wide standard, codified in the … ICD-9-CM Official Guidelines for Coding and Reporting, AR11429. It applies equally to providers in both the MA and traditional Medicare programs. See, e.g., 42 C.F.R. § 424.32(a)(2) (“A [FFS] claim for physician services . . . must include appropriate diagnostic coding for those services using ICD-9-CM.”). And in both programs, providers are far from perfect at meeting it. Invoking this principle thus merely raises—it does not answer—the relevant question: Given the reality that many providers submitting claims in both the MA and traditional Medicare programs do not consistently document their diagnosis codes in the medical charts, is it consistent with the statutory requirements and CMS’s prior pronouncements to impose obligations on MA plans with respect to those undocumented diagnosis codes that CMS does not impose on itself? The answer, as already explained, is that doing so is not consistent with either the statute or the agency’s past positions.

In short, there will be more to come in the matter of UnitedHealth Group, Inc. vs. the United States of America. We will keep monitoring this case for ongoing developments.

In the meantime, I hope you found these series of posts to be an interesting, real-life example of the need for CDI and clinical validation.

Editor’s note: To read the summary of the case, visit the DOJ website by clicking here. To read the Poehling court document in its entirety, click here. To read the (now dismissed) Swoben court document in its entirety, click here. Brian Murphy is Director of the Association of Clinical Documentation Improvement Specialists (ACDIS). He can be reached at bmurphy@acdis.org.