U.S. intervenes in UnitedHealth billing scheme suit

The federal government intervened in a qui tam lawsuit alleging that UnitedHealth Group entities (UnitedHealth) and Medicare Advantage organizations (MAOs) with which it contracted, including HealthCare Partners, deliberately concealed from the Medicare Part C program that they had submitted bills not supported by medical documentation, resulting in inflated risk adjustment payments that were never repaid to CMS. The U.S.’s intervention in this False Claims Act (FCA) (31 U.S.C. § 3729, et seq.), U.S. ex rel. Swoben v. Secure Horizons, is emblematic of its “commitment to ensure the integrity of the Medicare Part C program.” It is expected to file a complaint in another risk-adjustment-related FCA case, U.S. ex rel. Poehling v. UnitedHealth Group. Inc., no later than May 16, 2017.

MAOs must submit diagnosis codes for each enrollee for a particular calendar year to CMS (42 U.S.C. § 1395w-23(a)(3)). CMS uses the codes to create Hierarchical Condition Category (HCC) risk scores to adjust the capitated payment rates it pays to each MAO, increasing payment rates to MAOs with patient populations with more severe illnesses and decreasing payments to MAOs with patient populations with less severe illnesses. MAOs typically submit data to CMS and then perform a retrospective review of medical charts to ensure that the charts support the claims submitted. If an MAO discovers a diagnosis code for a patient that was not already submitted, it may do so at that time. However, MAOs are also required to withdraw previously submitted codes that they determine were not supported by medical documentation.

A former employee of Senior Care Action Network (SCAN) Health Plan and a consultant to the risk adjustment industry filed the qui tam suit and the government filed an intervening complaint, alleging that UnitedHealth, HealthCare Partners, and other defendants knowingly concealed the fact that previously submitted codes were not supported by medical documentation, resulting in higher risk adjustment payments. Specifically, the defendants hired coders to perform retrospective reviews, but knowingly concealed information about previously submitted codes so that the coders would not be able to identify codes that were not supported by medical documentation. In addition, certain employees created spreadsheets that did not permit the entry of previously submitted codes that should be withdrawn, as required by CMS.

HHS developing new system to speed PRRB, other appeal processes

HHS and its subagencies continue to struggle with eliminating the backlog of appeals that has led to delays in payments to providers and litigation trying to get HHS to meet statutory requirements for hearing appeals. The two main appeals backlogs relate to Provider Reimbursement Review Board (PRRB) decisions (appeals by providers of final determinations by Medicare contractors) and individual appeals for Medicare coverage, payment, and premiums brought before the Office of Medicare Hearings and Appeals (OMHA).

PRRB

CMS is developing a system to electronically track and file PRRB and Medicare Geographic Classification Review Board (MGCRB) decisions, according to CMS officials speaking at a conference sponsored by the American Health Lawyers Association at the end of March. The current appeals process relies heavily on a manual, snail mail process that has added to the time it takes for parties to file all papers in preparation for a hearing. The “Office of Hearings Case and Document Management System (OH CDMS)” should be ready for use by the end of 2017. The OH CDMS will be accessible through the CMS Enterprise portal.

Using the new system, parties may:

  • file appeal requests
  • upload position papers, jurisdictional documents, and other supporting documentation
  • view documents issued by Board or filed by opposing party
  • manage issues raised in individual appeals and providers participating in groups
  • request other actions such as change in representative, expedited judicial review, mediation, etc., and
  • monitor case status

This new system also will be used by CMS Hearing Officers who hear appeals not covered by other CMS or HHS appeal avenues, such as:

  • Risk Adjustment Data Validation (RADV)
  • Medicare Advantage/Prescription Drug Plan (MA/PD)
  • Medicaid State Plan Amendments
  • Retire Drug Subsidy Determinations (RDS)
  • Organ Procurement Organizations (OPO)

The need for a more efficient way of handling all the filings related to an appeal was underscored by a presentation by Sue Anderson, PRRB chairperson. She noted that the PRRB currently has more than 10,000 cases on its docket. In fiscal year 2016, the PRRB issued 27 decisions that closed 66 cases; 147 expedited judicial determinations; and 497 jurisdictional determinations, so it has a long way to go to work through its backlog.

OMHA appeals

Issues with PRRB appeals aren’t even the most serious ones facing HHS. The Office of Medicare Hearings and Appeals (OMHA) has a backlog of hundreds of thousands of administrative appeals, and the American Hospital Association is engaged in long-standing litigation with HHS trying to force HHS to hold Administrative Law Judge appeals within 90 days. Currently, these appeals take 10 times longer, and the backlog grows every year. A recent filing by HHS in the litigation shows the seriousness of the issue: as of March 5, 2017, there were 667,326 pending appeals; HHS projects the number of pending appeals to grow to 1,009,768 by the end of FY 2021 (September 30, 2021).

OMHA is looking at a number of ways to deal with the backlog; (see OMHA trying to speed claims appeals process, April 18, 2017). One solution is legislation. Speaking at the Health Care Compliance Association (HCCA) Compliance Institute at the end of March, Kimberly Brandt, Chief Oversight Counsel for the U.S. Senate Committee on Finance, noted that the Senate is considering re-introducing the “Audit & Appeal Fairness, Integrity, and Reforms in Medicare Act.” The bill “seeks to increase coordination and oversight of government audit contractors while implementing new strategies to address growing number of audit determination appeals that delay taxpayer dollars from reaching the correct source,” according to Brandt. The bill also would encourage the use of voluntary alternate dispute resolution process to allow for multiple pending claims with similar issues of law or fact to be settled as a unit, rather than as individual appeals.

Biosimilar dispute headed to the Supreme Court

Biosimilar manufacturers will soon have a definitive answer on the timing of giving notice of commercial marketing, thanks to the Supreme Court. On January 13, 2017, the Court granted and consolidated Sandoz, Inc.’s petition for writ of certiorari and Amgen, Inc.’s conditional cross-petition for writ of certiorari. The dispute appeals the Federal Circuit’s July 21, 2015 decision holding that Amgen was entitled to an additional 180-day marketing exclusivity period because of Sandoz’s late notification of its intention to market a biologic product that is biosimilar to Amgen’s Neupogen® (see Court interprets biosimilar ‘enigma’ in favor of abbreviated biologic license applicant, Health Law Daily, July 22, 2015).

The Court also granted Apotex, Inc.’s motion for leave to file a brief as amici curiae; Apotex was involved in a similar dispute with Amgen (see Biosimilar applicant must give 180-day post-licensure notice to reference sponsor, Health Law Daily, July 6, 2016), though the Court denied Apotex’s petition for writ of certiorari earlier this term (see SCOTUS denies cert in biosimilar licensing dispute, Health Law Daily, December 12, 2016).

The Biologics Price Competition and Innovation Act (BPCIA), which was passed in 2010 as sections 7001-7003 of the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148), created an abbreviated pathway for FDA approval of a “biosimilar” biologic product. Amgen originally brought suit against Sandoz in federal court asserting various violations of Amgen’s approved license for its cancer-fighting biologic Neupogen (filgrastim) and infringement of Amgen’s patent for a particular method of using filgrastim. The Court will be hearing arguments relating to Sandoz’s question regarding the 180-day notice of commercial marketing and Amgen’s cross-petition on the optionality of a process to settle patent disputes known as the “patent dance” (see Shall we dance? Biosimilars step toward new legal and regulatory future, Health Law Daily, March 31, 2016).

Makeup of the Court

Since the February 13, 2016, death of Justice Antonin Scalia, there have been eight Justices sitting on the Court. President Barack Obama’s nominee to replace Scalia, D.C. Court of Appeals Chief Judge Merrick Garland, was not considered by the Senate; President-elect Donald Trump plans to nominate a successor early into his term. In order to receive a vote in cases pending before the Court, a Justice must be seated on both the day of the oral argument and the day the written decision is released. Trump’s nominee will only be part of the decision if he or she is confirmed and duly sworn in before the oral arguments, which are not yet scheduled.

How will access to contraception coverage fare in light of the ACA repeal?

With the uncertainty about continued contraception coverage, a number of states have either enacted or introduced legislation to ensure that individuals continue to have access to contraception coverage and the number of women inquiring about birth control has increased. Since the November election and, in the wake of the imminent repeal of Obamacare, requests for intrauterine devices (IUDs) have been increasing significantly. Cecile Richards, President of Planned Parenthood, told CNN on January 9, 2017, that the demand for IUDs, a form of long-term birth control, has shot up 900 percent at Planned Parenthood branches because women “are desperately concerned that they will lose their access to health care,” SFGate news reported.

A December 7, 2016, Kaiser Family Foundation report that addressed private insurance coverage of contraception stated that many states have mandated minimum benefits for decades, including contraceptive coverage. Moreover, since the passage of the Affordable Care Act (ACA) (P.L. 111-148), states have strengthened and expanded the federal contraceptive coverage requirement. Among those states that have recently adopted contraceptive laws expanding ACA mandates for contraceptive coverage are New York, California, Oregon, Illinois, and Vermont.

New York

On January 11, 2017,  New York Attorney General Eric T. Schneiderman introduced “The Comprehensive Contraception Coverage Act of 2017” (CCCA), legislation that would provide access to cost-free contraception for women and expand coverage to men to ensure the continuation of contraception coverage under state law in light of Republicans’ goal of repealing the ACA.  The CCCA would (1) statutorily require state-governed health insurance policies to provide cost-free coverage for all FDA-approved methods of birth control, including emergency contraception, (2) prohibit insurance companies from “medical management” review restrictions that can limit or delay contraceptive coverage; (3) cover men’s contraceptive methods and bring their insurance coverage in line with the benefits enjoyed by women; and (4) allow for the provision of a year’s worth of a contraceptive at a time.

Crain’s New York Business addressed a number of items that are at stake in terms of women’s access to health care in New York under Donald Trump’s presidency. Although New York’s contraception legislation “has taken on new urgency for advocates since Trump’s victory,” the bill faces opposition from insurers because the provisions go beyond the ACA mandates, Crain’s predicted. In addition, Crain’s pointed out that Republicans in Congress will renew their efforts to defund Planned Parenthood, noting that access to services such as breast exams, Pap tests, STD screenings and family planning are most likely at risk of elimination for female Medicaid enrollees. Finally, abortion rights in New York might be curtailed if President-elect Trump’s Supreme Court judge appointee provides the Court with a majority of votes to overturn Roe v. Wade, the case that affirmed a woman’s constitutional right to an abortion under the 14th amendment. New York state law allows an abortion after 24 weeks only if it’s a matter of life and death for the woman, while constitutional law allows a woman to get a late-stage abortion if an anomaly poses a serious risk to her health or makes the fetus unviable, Crain’s explained.

Other States

In 2014, California passed the Contraceptive Coverage Equity Act of 2014 that requires plans to cover prescribed FDA-approved contraceptives for women without cost-sharing. In April of 2016, under the law, girls and women are able to drop by their neighborhood pharmacy and pick up birth control such as pills, patches, and injections without a doctor’s prescription but must speak with a pharmacist and fill out a questionnaire. Starting in January 2016, health plans were required to provide access to the full range of contraceptive methods approved by the FDA, including a variety of IUDs, for all insured individuals without cost-sharing, delays, or denial of coverage.

In 2015, Oregon passed two laws in 2015  expanding women’s access to birth control that became effective January 1, 2015.  HR2879 permits pharmacists to prescribe hormonal contraceptive patches and self-administered oral hormonal contraceptives, while HR3343 requires insurers to pay for a three-month supply of contraceptives when first prescribed, followed by a 12 month supply of contraceptives regardless of whether the woman was insured by the same plan at the time of the first dispensing. This law applies to oral contraceptive pills, the patch, and the vaginal ring.

The State Journal Register reported that Illinois adopted House Bill 5576, which will take effect January 1, 2017. Under the law, all ACA options must be covered without co-payments or deductibles, at least for women covered through health plans regulated by the state and plans that cover state employees, retirees, and their dependents. In addition, insurance companies must allow women to get a 12 month supply all at once.

The Burlington Free Press reported that Vermont legislation includes mandates from the ACA in the state law, but also expands upon the mandates to include additional birth-control methods, such as vasectomies. The bill specifies the 12 contraceptive products and services that must be included in health insurance plans as well as restrictions on cost-sharing for contraceptive services. It directs the Department of Vermont Health Access to establish 15 value-based payments for the insertion and removal of long-acting reversible contraceptives comparable to those for oral contraceptives.

Conclusion

Whether Congress repeals the ACA mandates requiring health insurance plans to provide contraceptive coverage and defunds Planned Parenthood is not certain. As of this writing, Congress has already taken initial steps to repeal the law. It remains to be seen if the actions the states have taken to ensure that both men and women have access to contraception under state law will hold up, and whether states that have introduced bills to ensure coverage will progress to enactment in the face of strong opposition.