Following $450 million settlement, DaVita subpoenaed for Medicare Advantage coding

Nearly two months after DaVita Healthcare announced it would pay nearly half a billion dollars to settle claims that it improperly billed Medicare for wasted vials of medication, the largest dialysis provider in the country is facing a subpoena from the U.S. Department of Health and Human Services (HHS), according to a Securities Exchange Commission (SEC) filing released by the company Wednesday.

The civil subpoena requests "a wide range of documents" from January 1, 2008 to present, pertaining to patient diagnosis coding and risk scores associated with Medicare Advantage plans.

According to the SEC filing, the HHS request is part of a "broader industry investigation into Medicare Advantage patient diagnosis coding and risk adjustment practices." In February, Humana revealed the Department of Justice (DOJ) is investigating its Medicare Advantage billing process, and as many as six whistleblower lawsuits, alleging Medicare Advantage overpayments, have already been filed this year.

DaVita added that some of the information requested relates to coding practices by HealthCare Partners (HCP), which was purchased by DaVita in November 2012. DaVita claims that the "practice in question was discontinued" following the acquisition, and the company notified CMS of the potential overpayments.

A company spokeperson told Bloomberg Business that DaVita looks forward to "working transparently and cooperatively with the government to resolve and help clarify coding-related issues."

On the same day, the Department of Justice (DOJ) officially announced the $450 million settlement with DaVita for false claims allegations linked to wasted medications. Last month, FierceHealthPayer: Antifraud reported on how the largest fraud settlement without government involvement unraveled thanks to claims that the defense tampered with witness testimony.  

Medicare Advantage plans, and risk scores in particular, have faced a steady stream of scrutiny over the last several months. Earlier this month, a government audit obtained by the Center for Public Integrity revealed that UnitedHealth Group overbilled the government $381,000 in 2012. Meanwhile, experts estimate that inflated risk scores reach as much as $2 billion each year. In May, two Senators called for fraud and abuse investigations into Medicare Advantage plans.

For more:
- here's DaVita's SEC filing
- read the DOJ release
- here's the Bloomberg Business article

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