In a September 2022 filing in U.S. ex rel. Osinek v. Kaiser Permanente, the Kaiser Permanente consortium defendants (Kaiser) highlighted the distinction between clinically inaccurate diagnoses (factual falsity) and clinically accurate but incorrectly coded diagnoses (legal falsity) and its relevance in False Claims Act (FCA) actions.
This distinction can be instructive and useful from an FCA defense perspective for Medicare Advantage plans and providers. The court’s treatment of this argument will be interesting to follow in light of the Supreme Court’s denial of certiorari in UnitedHealthcare Ins. Co. v. Becerra in which UnitedHealthcare challenged the validity of the Medicare Part C Overpayment Rule and as Medicare Advantage plans analyze their obligations to report and return overpayments under the revived rule. UnitedHealthcare Ins. Co. v. Becerra, 16 F.4th 867, 869 (D.C. Cir. 2021), cert. denied, 142 S. Ct. 2851 (2022).
Kaiser Case Background
On July 29, 2021, the United States intervened in six qui tam complaints alleging that Kaiser violated the FCA by submitting inaccurate diagnosis codes for its Medicare Advantage beneficiaries in order to receive higher reimbursements. The government intervened in part and on October 25, 2021, filed its complaint in intervention, consolidating the six individual qui tam lawsuits. United States ex rel. Osinek v. Kaiser Permanente, No. 3:13-cv-03891-EMC, Dkt. No. 110 (N.D. Cal. Oct. 25, 2021). The government’s complaint focuses on...
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