AIDS Healthcare Foundation, a Los Angeles-based nonprofit, has agreed to pay $1.44 million to resolve allegations that it violated the False Claims Act by submitting or failing to delete false or invalid diagnosis codes. The allegations center on diagnosis codes the organization is accused of using to increase payments it received through the Medicare Advantage program.
According to Justice News, the nonprofit was accused of either submitting bad codes outright or failing to delete them once they were flagged as inaccurate, with the Medicare Advantage program having provided payments to the foundation based on those submissions. The DOJ described alleged failures to investigate and delete unsupported codes, discussed the years involved and “Delete Research” spreadsheets, and included a separate allegation concerning HIV diagnosis codes for 2017.
AIDS Healthcare Foundation has previously faced other legal scrutiny unrelated to this settlement, including a separate whistleblower case involving alleged referral incentives and kickbacks. That matter should not be conflated with the current $1.44 million resolution, since the evidence available does not show the two are connected.
A Pattern of Medicare Advantage Settlements
The AIDS Healthcare Foundation case fits into a broader run of recent False Claims Act settlements tied to Medicare Advantage diagnosis coding. Earlier this year, Complete Health Partners Holdings, headquartered in Jacksonville, Florida, agreed to pay $14.1 million over allegations that it caused the submission of false diagnosis codes to boost Medicare Advantage payments, per a Justice Department announcement.
Other cases have involved far larger sums. Aetna agreed to pay $117.7 million in March to resolve similar False Claims Act allegations tied to Medicare Advantage submissions, while Koreatown-based Seoul Medical Group and its subsidiary agreed to pay $58.74 million, with former president Dr. Min Young Cha personally agreeing to pay $1.76 million, over allegedly false diagnosis codes for spinal conditions, according to the Justice Department's Central District of California office. Monogram Health, meanwhile, agreed to pay $2.4 million in August to settle its own False Claims Act suit over Medicare Advantage billing.
How Federal Auditors Check Medicare Advantage Codes
The scrutiny on diagnosis coding stems in part from the Centers for Medicare & Medicaid Services' Risk Adjustment Data Validation program, which the agency describes as its primary way to address overpayments to Medicare Advantage organizations. During an audit under that program, CMS confirms whether diagnoses submitted by an organization for risk adjustment are actually supported in enrollees' medical records.
AIDS Healthcare Foundation's Reach
The Justice Department describes AIDS Healthcare Foundation as providing care and services to HIV patients in the United States and other countries, and says its managed-care division operated plans in Florida, Georgia, and California. CBS News, citing the foundation's own website, has reported that the Los Angeles-based organization cares for more than 400,000 patients in 36 countries.
The DOJ identified Donna Irons as a qui tam whistleblower and gave the case caption, civil action number, and Central District of California venue.
