10/27/14, "New York City Agency and Vendor Bilked Medicaid, U.S. Says," NY Times, Benjamin Weiser
"Federal authorities have accused New York City officials of a five-year effort to defraud Medicaid, working with a contractor to exploit loopholes in Medicaid’s computerized billing system to collect reimbursements that amounted to tens of millions of dollars.
The office of Preet Bharara,
the United States attorney for the Southern District of New York, said
on Monday that the city’s Department of Health and Mental Hygiene and
the contractor, Computer Sciences Corporation, created schemes from 2008
through 2012 that would produce reimbursements on tens of thousands of
false claims for early intervention program services for infants and
toddlers....
If the city did not have adequate insurance information from the patient, it would not make any effort to find the correct policy information, the office said.
Instead, a computer program was created that would insert 999-999-999 as the purported policy number.
Private insurers would quickly reject the claims, freeing the city to submit them to Medicaid.
The lawsuit, which follows a whistle-blower’s complaint, was filed under the False Claims Act. The lawsuit demands triple damages and penalties, but does not specify how much it is seeking. But in just one four-day period in April 2009, the lawsuit claims that the false diagnosis data was used on more than 600,000 claims, resulting in a $49 million payment from Medicaid to the city....
New York State joined in the whistle-blower lawsuit, making its claim only against Computer Sciences Corporation....
The lawsuit mirrors a similar civil complaint filed by Mr. Bharara’s office in 2011. In that case, the city was accused of overbilling Medicaid by improperly approving 24-hour home care for thousands of patients. New York City eventually paid the federal government
$70 million to settle that claim.
In
announcing the lawsuit on Monday, the United States attorney’s office
said that the fraud schemes outlined in the complaint were “part and
parcel of a general practice at C.S.C. and the city to blatantly disregard their obligations to comply with Medicaid billing
requirements.”
Medicaid typically pays reimbursements quicker than private insurers,
and with fewer requirements. It also covered a larger share of early
intervention services than the state’s own funds for such programs.
The
complaint suggested that the fraud scheme was designed to serve the
city’s and the company’s economic interests, noting that the city linked
the amount of fees it paid to the amount of Medicaid payments the
company obtained for the city.
Mr.
Bharara’s office said in the lawsuit that when the former finance
director of the city’s early intervention program was asked whether he
had “schemed” with Computer Sciences Corporation to submit false claims
to get Medicaid payments, he
The official was not identified in the suit.
The
suit said that even before the computer firm was hired, the city
official had made it a practice to submit claims using the default 315.9
diagnosis code, rather than the codes generated by service providers;
he later asked the firm to use that code.
After
April 2009, the suit says, Computer Sciences Corporation and the city
continued to use the 315.9 code improperly. When the city and the
company noticed that Medicaid had denied several hundred thousand early
intervention claims because of invalid diagnosis codes, they revised a
computer program to replace the invalid codes with the default 315.9
code in Medicaid claims.
The
suit said that the computer firm was aware that it was submitting
claims to Medicaid with diagnosis codes that “did not accurately reflect
the diagnoses” for which the early intervention program “services were
being rendered.”
The
firm, based in Falls Church, Va., said in its statement that all
eligible beneficiaries received the early intervention services to which
they were entitled, and that the firm did not submit any claims to
Medicaid for which the city “was not entitled to be paid.”
It
said the city was “properly reimbursed for these services” and
“Medicaid would have paid out the same amounts of funds” for the early
intervention program “irrespective of any claims processing issues.”
The
early intervention program provides services to children under 3 years
old who have been found to have developmental delays or have been
diagnosed with medical conditions, like autism and low birth weight,
with a high probability of causing such delays, the lawsuit says.
The
original whistle-blower suit was filed under seal in 2012, the document
shows, by Vincent Forcier, who worked as a senior manager at Computer
Sciences Corporation in its Kansas office, according to his LinkedIn
profile. In April 2013, he went to work for H&R Block, the profile
says. Under the law, Mr. Forcier could receive 15 percent to 25 percent
of any recovery in the case.
Mr.
Forcier declined to comment when reached by phone. His lawyer, Shelley
R. Slade, said, “Mr. Forcier, in filing his suit, took on significant
professional and personal risk, and I applaud his courage for standing
up to do what he believed was the right thing.”"
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