Commonwealth Care Alliance, Inc. (CCA) has agreed to pay $520,355.65 following allegations related to the False Claims Act. The U.S. Attorney's Office claims that Reliance HMO, Inc., acquired by CCA in 2022, made cash payments to encourage referrals of Medicare beneficiaries to its Medicare Advantage Plan, violating the Anti-Kickback Statute.
Medicare Advantage Plans are managed care insurance options under Medicare Part C. These plans receive monthly payments from the Centers for Medicare & Medicaid Services (CMS) for each enrolled beneficiary. The Anti-Kickback Statute prohibits payment or receipt of remuneration for referring individuals or arranging services covered by federal healthcare programs.
CCA is a non-profit based in Boston offering MA Plans. In April 2019, CMS authorized Reliance HMO to operate a plan in Michigan with coverage starting January 2020. After acquiring a majority stake in Reliance on March 31, 2022, CCA found issues with certain marketing practices and disclosed two specific schemes.
The first scheme involved cash payments from April 12, 2019, through December 22, 2020, given to healthcare professionals and staff for patient contact information through "permission to contact" cards related to MA plan offerings.
The second scheme occurred in November 2019 when Reliance paid four physicians and practices $2,500 as advances on "coordination of care" services before their MA plan became active in 2020.
The U.S. alleges these payments were intended as kickbacks for enrolling beneficiaries into Reliance’s MA plan and violated the False Claims Act. The settlement resolves these claims without any admission of liability.
CCA voluntarily disclosed this conduct and received credit for cooperation with remedial actions such as terminating involved employees and providing detailed investigation reports to assist the government.
U.S. Attorney Dawn N. Ison stated: “Our office encourages companies and individuals to make timely self-disclosures and take remedial measures to mitigate the harm from fraud that they discover.” Special Agent Mario Pinto added: "Paying kickbacks in exchange for patient referrals can drive up costs and lead to unnecessary medical services."
Assistant U.S. Attorney Jonny Zajac handled the civil investigation with assistance from HHS-OIG.
###