A new whistleblower lawsuit accuses a California health care firm of diagnosing “false and fraudulent” medical conditions that several Medicare Advantage plans allegedly used to overcharge the federal government by $1 billion or more.
The suit was filed by Anita Silingo, a former compliance officer for Mobile Medical Examination Services, Inc., or MedXM. The Santa Ana, California-based firm sends medical professionals to the homes of Medicare Advantage members to assess their health.
Silingo claims she was fired last year after she tried to stop MedXM from exaggerating how sick these patients were, which raised government payments to the health plans. The suit, filed in August 2013 in California, was unsealed by a judge late last month.
The suit also names four Medicare Advantage insurance plans which, Silingo alleges, “turned a blind eye” to the practices. The health plans named in the suit are: Molina Healthcare of California; WellPoint, Inc., which operates Anthem Blue Cross and Blue Shield; Health Net of California, Inc. and Alameda Alliance for Health. None would comment.
MedXM chief executive officer Sy Zahedi called the allegations “categorically not true.” In a brief interview, Zahedi said: “I can’t comment on any litigation right now, but anybody is free to file a lawsuit.” He said the company was “just served (with the suit) a week ago. It is brand new to us. We look forward to our day in court.”
Whether her claims hold up in court or not, Silingo’s lawsuit is likely to draw further attention to government oversight of Medicare Advantage plans. The health plans, an alternative to standard Medicare, are mostly run by private insurance companies. They serve more than 15 million Americans, or about one in three elderly and disabled people on Medicare, at a cost to taxpayers that could reach $160 billion this year. The plans are paid based on a “risk score,” which estimates how sick patients are. Medicare pays higher rates for sicker patients.
Critics argue that federal officials waste billions of tax dollars every year by failing to crack down on health plans that game the arcane payment system. At least five other whistleblower cases accusing Medicare Advantage of fraudulently inflating risk scores are winding through federal courts, records show.
Silingo worked at MedXM from August of 2011 to June of 2013. Under federal Medicare regulations, a compliance officer’s job is to make sure that regulations are followed and any violations are corrected.
Silingo says she was fired after alerting her bosses to problems ranging from doctors who did implausibly large numbers of evaluations in a day to inaccurate blood tests that she said skewed diagnostic results.
“She noticed these types of things and complained to upper management, but they blew her off,” said her attorney, William K. Hanagami. He declined to make Silingo available for an interview.
Silingo cites problems with in-home health visits to Medicare Advantage patients in Ohio, New York, California, Texas, Oregon and Virginia.
The four health plans “turned a blind eye to the truth” because the MedXM health assessments made them money, according to the suit.Medicare Advantage plans argue that the in-home health assessments can help members stay fit and in their homes as long as possible by spotting untreated diseases and dangerous living conditions. While the doctors and nurses don’t offer any treatment during their visit, they report their exam findings to the patient’s primary care physician.
But home visits also are controversial, largely due to their impact on Medicare costs.
In June, a Center for Public Integrity investigation found that home visits were flourishing as federal officials struggled to prevent Medicare Advantage plans from overcharging the government by billions of dollars every year. Medicare made nearly $70 billion in “improper” payments to Medicare Advantage plans from 2008 through 2013, mostly overbillings based on inflated risk scores, according to the government’s own estimates.
Federal officials last year said they were concerned that some health plans may be turning to home visits and other strategies that drive up risk scores — and Medicare costs — without offering patients more actual medical services or tangible health benefits.
In April, though, officials bowed to industry pressure and backed off an earlier proposal to restrict the home visits, which the industry estimated would have cut their Medicare payments by nearly $3 billion a year.
In her lawsuit, Silingo cites a range of problems with how the visits were conducted.
The lawsuit names nearly 70 nurse practitioners and physician assistants whom she claims were not properly supervised by doctors. Some evaluations were conducted over the phone rather than in person, as required by federal regulations. In other cases, Silingo alleged, medical coders directed the health professionals to “modify” medical records “in order to increase the severity of the patients’ diagnosis.”
In some instances, doctors or other medical professionals didn’t arrive at patients’ homes with diagnostic gear such as a portable EKG or X-ray machine that would be needed to confirm some of the diagnoses later reported to the health plans, according to the suit.
Patients were not required to remove clothing which prevented doctors from accurately assessing a number of medical conditions, such as heart disease and serious lung disease, according to the suit.
These “false and improperly confirmed” diagnoses inflated the enrollees’ risk scores, resulting in higher government payments, the suit alleged.
Some doctors and nurses were scheduling 20 to 25 of the home visits per day. The suit names three doctors whom it says scheduled at least 20 of the visits in a single day. Doctors were paid on average $100 for each exam.
“Such a high volume of daily in-home face-to-face assessments could not have occurred because of the time required to travel from one patient’s home to the next,” according to the suit.
In some cases blood work collected from patients was “spoiled” because it was not submitted to labs for analysis quickly enough, rendering results “unreliable,” according to the suit.
In December of 2012 about 750 Molina patients had “identical vital statistics for age, weight, sex height, blood pressure and heart rate” as well as similar medical findings, all done by the same doctor.
That doctor was “routinely” completing more than 22-25 assessments per day “traveling over a wide geographic area making it implausible that he actually performed the work that he claimed,” according to the suit.
Each of the health plans that contracted with MedXM was required to monitor its performance, but failed to do so adequately, according to the suit, which argues that the government was “damaged in excess of $1 billion.”
Zahedi, the MedEX chief executive, said that his firm is “one of the smaller ones” that conducts in-home risk assessment reviews for Medicare Advantage plans.
While he declined to discuss the state of the industry, he said: “We’ll have tons to say once we get our day in court.”
Read more in Health
HHS inspector general announces new round of fraud audits