Thousands of New York residents receive Medicare coverage from insurance companies like the Cigna Group. The federal government expects insurance providers to submit timely and accurate information to make sure that these private insurance plans are administered correctly, and companies that fail to meet these requirements can face sanctions for breaching the False Claims Act. On Sept. 30, the U.S. Department of Justice announced that Cigna has agreed to pay more than $172 million to settle alleged False Claims Act violations.
The Medicare Advantage Program
The Medicare Advantage Program allows companies like Cigna to offer private insurance policies that provide Medicare coverage. The Centers for Medicare and Medicaid Services sends health insurance providers a fixed monthly payment that is adjusted based on risk factors for each beneficiary enrolled in MA plans. CMS relies on insurers to provide accurate diagnosis codes and other data to ensure that risk is assessed properly. The DOJ claims that Cigna submitted untruthful and inaccurate data to artificially inflate these monthly payments.
Federal Medicare fraud investigators allege that Cigna submitted false information about MA plan beneficiaries between 2014 and 2021. They also claim that the Connecticut-based insurer failed to withdraw diagnosis data that it knew to be untruthful. In addition to paying $172,294,350 to resolve these allegations, Cigna will enter into a Corporate Integrity Agreement overseen by the U.S. Department of Health and Human Services. This means that Cigna will have to meet stricter auditing requirements and conduct annual risk assessments for the next five years.
The investigation into Cigna’s alleged fraudulent activities was launched when a whistleblower stepped forward. The DOJ claims that these activities went undetected for years, which suggests that the procedure for verifying MA plan data and approving MA plan payments should be subjected to stricter oversight.