Cigna Embroiled in Lawsuit Over Wellness Program Risk Adjustment

A lawsuit was filed against Cigna on August 4, 2020 for $1.4 billion in false and fraudulent risk adjustment claims between 2012 and 2017, according to a court filing obtained by Axios.

The plaintiff—who is filing on behalf of the United States, since the Department of Justice declined to participate in the lawsuit, according to Cigna—is an officer from a third-party vendor, Texas Health Management, LLC. The vendor provided services to Cigna for the wellness program that Cigna may have used to formulate false ICD codes to boost its risk scores.

“These ICD Codes referred to health conditions of Medicare beneficiaries that (1) did not exist, (2) were not recorded in any medical records and (3) were not based on clinically reliable information,” the file stated.

The lawsuit went on to say that these fraudulent submissions were intentional. According to the lawsuit, the payer sought to raise its risk adjustment score by sending CMS these fraudulent claims to raise its capitated rate.

As a result, the file stated, CMS paid out $1.4 billion to Cigna for fraudulent claims.

Cigna has denied the lawsuit’s assertions and stood by its methods.

“We are proud of our industry-leading Medicare Advantage program and the manner in which we conduct our business,” Cigna told HealthPayerIntelligence in an emailed statement. “We will vigorously defend Cigna against all unjustified allegations.”

According to the lawsuit, Cigna’s false claims largely came from its 360 Program, a wellness program designed to expand on the typical annual wellness visit that Medicare reimburses. Whereas Medicare’s wellness visits focus on updating basic information such as weight and medical history, Cigna’s program enhanced the visit by including a routine physical exam.

Thus, Cigna pitched the program as “closing gaps in care.”

“Senior executives at Cigna-HealthSpring pointed out that many Plan Members were not visiting their PCPs for an annual physical exam due to the fact that Medicare would not cover the cost,” the lawsuit summarized.

“As a result, they claimed that serious health conditions were not being detected and that by performing the 360s PCPs would be able to diagnose and treat these health conditions and therefore improve the quality of care.”

Instead of increasing quality of care, however, the program identified members with high cost conditions that would be most likely to boost Cigna’s risk score using data analytics and risk stratification.

The program incorporated a 360 Form that did not differentiate between data collected empirically by the provider—such as information from the on-site 360 wellness exam—and data reported by the patient—such as personal medical history.

The Form, according to the plaintiff’s argument, demanded that providers give a conclusion or a diagnosis based on anecdotal evidence.

“As a result, any diagnoses made from performing the 360s lacked accuracy because the type of evidence upon which the conclusions relied could have been drawn from either source,” the suit argued.

The lawsuit asserted that there was proof of misdiagnoses that providers offered based on the reported data and furthermore that the payer knew these misdiagnoses had occurred and that the form had performance problems.

Providers were so resistant to the 360 Program that Cigna had to turn to third-party vendors to complete the wellness checks. The third-party vendor, which is now bringing this lawsuit against Cigna, said that it emphasized to the Cigna executives that the data could not be used to confirm a diagnosis and that the data were only useful for providers to review.

Nevertheless, Cigna reported the ICD codes for these wellness checks as if they were a clinically reliable diagnosis, the lawsuit alleges.

Earlier this year, the DOJ took Anthem to court on similar grounds.

According to the Anthem lawsuit, the payer incorporated a “retrospective chart review” through a third-party vendor which allowed the payer to significantly delay reviewing services documentation. The payer could submit false or inaccurate claims and be purposefully ignorant until months later, the lawsuit stated.

“The suit is another in a pattern that attempts to hold Anthem and other plans to a standard on risk adjustment practices, without providing clear guidance,” Anthem rebutted in a written statement which the payer emailed to HealthPayerIntelligence.

“Where regulations have not been clear, Anthem has been transparent with CMS about its business practices and good faith efforts to comply with program rules. We think the agency should update regulations if it would like to change how it reimburses plans for services delivered.”

The news of this lawsuit against Cigna comes during a year that the payer has a host of new Medicare Advantage markets, having expanded into 80 counties in 17 states.

“This is an exciting year for Cigna as we roll out our biggest Medicare Advantage expansion to date with new geographies and new products,” Brian Evanko, president of Cigna's government business, said in October 2019 around the time of open enrollment.

The company expected a 13 to 16 percent increase in its Medicare Advantage consumer base and has a goal of covering 87 percent of its Medicare Advantage members in plans with four stars or higher.

Cigna has also been focusing its efforts on developing a strong presence in the small group health insurance market alongside Oscar Health.