Insurance giant Cigna (NYSE: CI) has reached an agreement with the U.S. government over claims it overcharged the Medicare Advantage (MA) program by misrepresenting patients’ conditions.

As part of the agreement, Cigna will pay more than $172 million to the government and will also enter into a corporate integrity agreement with the U.S. Department of Health and Human Services Office of the Inspector General (OIG).

Among the allegations, the government said Cigna used vendors to do in-home assessments of its plan members, but the nurses failed to do the tests or imaging necessary to accurately diagnose serious conditions.

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Afterward, Cigna billed Medicare using billing codes associated with conditions for these unconfirmed diagnoses to secure higher payments.

“For years, Cigna submitted to the government false and invalid diagnosis information for its Medicare Advantage plan members,” Damian Williams, U. S. attorney for the Southern District of New York, said in a statement. “The reported diagnoses of serious and complex conditions were based solely on cursory in-home assessments by providers who did not perform necessary diagnostic testing and imaging. Cigna knew that these diagnoses would increase its Medicare Advantage payments by making its plan members appear sicker.”

Bloomfield, Connecticut-based Cigna is one of the largest health insurance companies in the country. It contracts with other organizations that offer certain services and products to Cigna...

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