Published on FierceHealthPayer (http://www.fiercehealthpayer.com)

OIG: Cigna overbilled Medicare Advantage for $28M in 2007

May 8, 2013 | By Dina Overland

Cigna Healthcare of Arizona, a subsidiary of national insurer Cigna providing Medicare Advantage plans, overbilled Medicare by about $28 million in 2007, according to a new report released last week from the U.S. Department of Health & Human Services Office of Inspector General.
The OIG determined that Cigna submitted diagnoses to HHS for its risk score calculations that didn't always comply with federal requirements. Of the 100 beneficiaries in the sample OIG analyzed for the report, 40 had invalid risk scores because either the documentation didn't support the associated diagnosis or the diagnosis was unconfirmed.
Because Cigna's contracts require its providers submit accurate claims, the insurer assumed all providers were submitting accurate diagnoses as well. But the OIG said providers often report incorrect diagnoses or report diagnoses for conditions that didn't exist when providers treated the beneficiaries.
Based on its investigation, the OIG said Cigna must repay at least $151,000 in improper charges. The federal auditor also recommended that HHS conduct a more in-depth review of the disputed payments. Also, CIGNA needs to bring its "significant error rate" into compliance with federal rules, the report said.
"For one beneficiary, Cigna submitted the diagnosis code for 'congestive heart failure, unspecified,' " the report said. "However, the documentation that Cigna provided indicated that the beneficiary visited the physician because of knee pain. The documentation did not support the diagnosis of congestive heart failure."
Cigna, however, disagreed with the OIG's findings. In a written response to the report, Cigna said the OIG didn't properly account for frequent disparities in charges shown in claims data and in medical records. What's more, the OIG should have analyzed more medical records in its sample and taken a different statistical approach, both of which would have resulted in Cigna owing a total of just $440,000.
HHS will review the report and decide whether to implement the OIG's recommendations or take separate action. Cigna can appeal the report's findings.
To learn more:
- here's the OIG report