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Healthcare provider accused of upcoding

A data analytics firm has accused a healthcare provider of False Claims Act violations. The group states the provider illegally received payment for over $188 million in Medicare claims. If the suit is successful, the firm would receive a portion of the winnings.

The lawsuit is based on two primary allegations:

  • Secondary codes. The lawsuit claims the provider increased its bill to Medicare by adding secondary codes to Medicare claims. The provider allegedly used these codes solely for the purpose of increasing the cost of the claim.
  • Profitable diagnoses. The suit further contends the healthcare provider encouraged physicians to document diagnoses that would result in a high return. The provider allegedly gave medical professionals “tip sheets” to determine which secondary diagnoses were more financially profitable than others.

The firm’s allegations against the provider overlap. Secondary codes used to achieve a higher payout often included specific, profitable diagnoses such as included encephalopathy, respiratory and malnutrition. The tip sheets noted above allegedly stated the use of malnutrition as a secondary code would result in added severity as a major complication or comorbidity and prolong care needed and increase the length of stay for the patient.

If successful, the provider would be required to make payment to the government for any illegal claims. However, it is important to note it is early in the legal process. The firm filed the complaint on August 10, 2018. It is not yet clear if the firm will find success with its allegations. Regardless, providers that find themselves the subject of a suit such as this are wise to seek legal counsel to protect their interests.