Cigna sued for improperly using algorithm to reject patient claims
A class action lawsuit accuses Cigna Corp. and Cigna Health and Life Insurance Company of using a computer algorithm to automatically reject patient claims without examining them individually.
The lawsuit, which was brought by two individuals who were denied coverage by Cigna, claims the organizations developed an algorithm called PXDX that enabled its doctors to automatically deny payments in batches of hundreds or thousands at a time for treatments that do not match pre-set criteria, thereby evading the legally-required individual physician review process.
The suit was filed in the United States District Court for the Eastern District of California in the wake of a ProPublica investigation this March that revealed how Cigna doctors rejected patients’ claims without opening their files.
The scope of the problem is massive, according to the complaint. Over a period of two months in 2022, Cigna doctors denied over 300,000 requests for payments using the algorithm, spending an average of just 1.2 seconds “reviewing” each request.
The plaintiffs seek an injunction against the PXDX algorithm and monetary damages, along with a jury trial.
Study: Docs who treat high-risk patients less likely to be in MA networks
A recent study published in JAMA Health Forum finds that physicians with the highest proportion of patients who were dually eligible for Medicare and Medicaid and with the highest Hierarchical Condition Category scores within traditional Medicare were associated with a significantly lower likelihood of being include in Medicare Advantage (MA) networks.
Researchers conducted a cross-sectional study of 259, 932 clinicians participating in Medicare in 2019 to examine the association of physicians caring for patients with higher level of social and clinical risk in traditional Medicare with the likelihood of inclusion in MA plan networks.
The gap in network inclusion may result in physicians who are already underresourced to be included from plans at higher rates, researchers concluded. Another possibility is MA plans may be less attractive to these physicians. “As MA plan penetration, particularly among enrollees with dual eligibility, increases in coming years, it will be imperative to ensure that patients have access to physicians who can address their care needs,” researchers concluded.
OIG: Virginia made $21M capitation payments to Medicaid MCOs after enrollee deaths
The Office of Inspector General (OIG) released an audit that finds Virginia made unallowable capitation payments to Medicaid Managed Care Organizations (MCOs) after enrollee’s deaths. The audit covered more than 58,000 capitation payments totaling over $70.8 million that Virginia made to MCOs and claimed for federal reimbursement during calendar years 2019-2021 on behalf of 12,054 enrollees whose dates of death preceded the monthly service periods covered by the capitation payments.
To conduct the audit, OIG selected and reviewed a stratified random sample of 100 capitation payments totaling $319,525 ($195,219 federal share) from those 58,351 capitation payments.
Analysts found that the state agency made unallowable capitation payments after enrollees' deaths. For 67 of the 100 capitation payments, Virginia made unallowable capitation payments totaling $76,939 ($51,062 federal share). For 30 of the remaining capitation payments in the sample, Virginia adjusted the capitation payments before the audit. Analysts couldn’t confirm whether the remaining three enrollees associated with the capitation payments were deceased.
Based on the sample results, OIG determined that Virginia made unallowable capitation payments totaling at least $21.8 million ($15.7 million federal share) to MCOs on behalf of the deceased enrollees during the audit period. These payments were made because Virginia didn’t have adequate controls in place to enable it to identify all deceased enrollees and properly cancel their enrollment, OIG said.
OIG recommends that Virginia refund $15.7 million to the federal government; identify and recover the $21.8 million unallowable capitation payment made to MCOs during the audit period; and identify and recover unallowable capitation payments made on behalf of deceased enrollees in 2018 and 2022 and repay the federal share of amounts recovered.
DOJ charges owner of telemedicine company with $44M Medicare fraud scheme
The owner of Conclave Media and Nationwide Health Advocates has been charged and has agreed to plead guilty in connection with a $44 million telemedicine fraud scheme involving medically unnecessary durable medical equipment (DME) and genetic tests, according to the Department of Justice (DOJ).
David Santana, 38, has agreed to plead guilty to one count of conspiracy to commit health care fraud.
According to the DOJ, between January 2018 and August 2021, Santana, through his companies, entered into business relationships with telemarketing companies that generated leads by targeting Medicare beneficiaries. The telemarketers then allegedly paid Conclave and Nationwide on a per-order basis to generate orders for DME and genetic testing for these beneficiaries.
To arrange for these orders to be signed, Santana allegedly worked with medical staffing companies to find doctors and nurses who were willing to review and sign prepopulated orders, typically without any contact with the beneficiaries. Santana then allegedly provided the signed orders to the telemarketing companies, which sold the orders to DME suppliers and laboratories. The DOJ claims Santana knew these DME suppliers and laboratories would use the signed orders to submit claims to Medicare for DME and genetic testing that were medically unnecessary, based on false documentation and tainted by kickbacks.
The charge of conspiracy to commit health care fraud provides for a sentence of up to 10 years in prison, supervised release for up to three years, and a fine of up to $250,000 or twice the gross pecuniary gain or loss, whichever is greater. A plea hearing has not yet been scheduled.
Trade groups release data sharing best practices to support value-based care
AHIP, the American Medical Association (AMA), and the National Association of ACOs (NAACOS) recently released data sharing best practices that organizations may voluntarily adopt to support a sustainable future for value-based care.
The playbook aims to provide health insurance providers, physicians and other health professionals, hospitals, and value-based care entities with access to best practices informed by real-world experiences to help guide, in a voluntary manner, considerations for the design, implementation, and evaluation of potential future arrangements that accommodate participants with a range of experience.
“When diverse minds and perspectives collaborate, the true potential of value-based care emerges,” said Matt Eyles, AHIP president and CEO, in the announcement. “The playbook represents collective effort and shared responsibility, with the goal of reshaping the health care landscape, empowering patients, reducing operational burden, and driving positive change.”
The playbook is the beginning of an ongoing partnership among the three organizations to explore how to sustain momentum for and grow broad-based participation in value-based care arrangements to improve the lives of patients and families throughout the U.S. The first phase of this effort focused on data sharing as a fundamental building block of value-based care operations. “The success of value-based care hinges on delivering the best care, in the proper setting, at the right time,” said Clif Gaus, Sc.D., president and CEO of the National Association of ACOs. “To do that, clinicians need timely, actionable data. Our recommendations for both policy and private industry data sharing aim to ensure sustained success and growth of value-based care.”
The groups are exploring other areas for future potential collaboration concerning value-based care arrangements, including payment methodologies, specialty-primary care coordination, actionable quality metrics, patient engagement, and care delivery.