Cigna pays $172M to resolve FCA allegations

PHILADELPHIA – Cigna has agreed to pay $172 million to resolve allegations that it violated the civil False Claims Act by submitting and failing to withdraw inaccurate and untruthful diagnosis codes for its Medicare Advantage Plan enrollees to increase its payments from Medicare.  

Cigna will pay about $135 million to resolve the allegations, with the remaining $37 million resolving allegations related to unsupported diagnoses for MA beneficiaries arising from Cigna’s home visit program. 

“Given the growth of Medicare Advantage plans, investigating fraud involving Medicare Part C is more important than ever,” said U.S. Attorney Jacqueline C. Romero of the Eastern District of Pennsylvania, which conducted the investigation. “My office has prioritized combatting Medicare Advantage fraud, including applying data-driven investigative methods and working extensively with our law enforcement partners across the country. We will hold accountable those who report unsupported diagnoses to inflate Medicare Advantage payment, such as unsupported diagnosis codes for morbid obesity.” 

More than half of all Medicare beneficiaries are now enrolled in MA plans, with CMS paying private insurers more $450 billion each year to provide for their care.  

The government contends that for payment years 2014-19, Cigna operated a “chart review” program in which it retrieved medical records from health care providers documenting services they had previously provided to Medicare beneficiaries enrolled in its plans. It retained diagnosis coders to review those charts to identify all medical conditions that the charts supported; to assign the beneficiaries diagnosis codes for those conditions; and to submit additional diagnosis codes to CMS that the health care providers had not reported. 

However, Cigna’s chart reviews also did not substantiate some diagnosis codes that were reported by providers and previously submitted by Cigna to CMS. Cigna did not delete or withdraw these inaccurate and untruthful diagnosis codes, which would have required Cigna to reimburse CMS. Thus, the government alleges that Cigna used the results of its chart reviews to identify instances where Cigna could seek additional payments from CMS, while improperly failing to use those same results when it provided information about instances where it was overpaid. 

In connection with the settlement, Cigna has entered into a five-year Corporate Integrity Agreement (CIA) with the U.S. Department of Health and Human Services Office of Inspector General. The CIA requires that Cigna implement numerous accountability and auditing provisions. On an annual basis, top executives and members of the board of directors must make certifications about Cigna’s compliance measures, Cigna must conduct annual risk assessments and other monitoring, and an independent review organization will conduct multi-faceted audits focused on risk adjustment data.