U.S. intervenes in whistleblower case alleging false submissions to Medicare Advantage

By Marian Johns | Dec 14, 2018

WASHINGTON, D.C. — The federal government is intervening  in a whistleblower lawsuit against Sutter Health LLC and its affiliate Palo Alto Medical Foundation, alleging the health care providers intentionally submitted false patient information to the Medicare Advantage program in order to receive higher payments.

According to the U.S. Department of Justice (DOJ), Sutter violated the False Claims Act by submitting "unsupported diagnosis codes" for Medicare Advantage beneficiaries that raised the "risk scores" of the patients and led to higher payments from the Medicare Advantage program.

“Federal health care programs rely on the accuracy of information submitted by health care providers to ensure that patients are afforded the appropriate level of care and that managed care plans receive appropriate compensation,” department Civil Division assistant attorney general Jody Hunt said in a statement. “[This] action sends a clear message that we will seek to hold health care providers responsible if they fail to ensure that the information they submit is truthful.” 

“The share of Medicare beneficiaries enrolled in Medicare Advantage has steadily grown over the past decade, with 19 million beneficiaries enrolled in 2017," added Northern District of California U.S. attorney Alex Tse. " It is critically important that the data submitted to the Medicare Advantage program is truthful, because the government relies on this information to set payment levels.  We will continue to guard government health programs from companies that improperly maximize their bottom line at taxpayer expense.”

The case, United States ex rel. Ormsby v. Sutter Health, et al., stems from a former Palo Alto Medical Foundation employee's allegations. 


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