Oak Street Health, a wholly-owned subsidiary of CVS Health since 2023, has agreed to pay $60 million to resolve allegations that it violated the False Claims Act (FCA) by paying kickbacks to third party insurance agents in exchange for their recruiting of seniors to Oak Street Health’s primary care clinics.
The United States alleged that prior to CVS’ ownership, in 2020, Oak Street Health developed a program to increase membership – the Client Awareness Program. Under the Program, at the direction of Oak Street Health, third-party insurance agents would contact seniors who were eligible for (or already enrolled in) Medicare Advantage and then delivered marketing messages to them that were designed to create interest in Oak Street Health. Agents would then refer interested seniors to an Oak Street Health employee through a three-way phone call or an electronic submission.
Oak Street would typically pay agents $200 per beneficiary referred or recommended to the company, incentivizing the agents to make referrals and recommendations to Medicare beneficiaries based on financial motivations for themselves – not the best interest of the senior patients.
According to the government, thousands of Medicare beneficiaries and a small number of Illinois Medicaid beneficiaries received Government-reimbursed care at Oak Street Health, as a result of the Client Awareness Program.
The settlement resolves allegations that from September 2020 through December 2022, Oak Street Health...
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