California's healthcare system and providers must pay $70.7 million over false claims
A county health system in California and three county healthcare service providers will pay a combined $70.7 million to resolve claims that they broke the False Claims Act (FCA) in relation to Medi-Cal, the state's Medicaid program.
According to a press release issued on Thursday by the Department of Justice, Gold Coast Health Plan, along with service providers Dignity Health, Clinicas del Camino Real, and the Ventura County Medical Center, will return the funds to the federal government and the state of California as part of their settlements (DOJ).
Dignity will pay $10.8 million to the United States and $1.2 million to California; Gold Coast will pay $17.2 million; Ventura County will pay $29 million; and Clinicas will pay $11.25 million to the United States and $1.25 million to California. The providers reached agreements without acknowledging or disputing the charges.
Two whistleblowers, former Gold Coast controller Atul Maithel and former director of member services Andre Galvan, alleged FCA breaches in a federal qui tam complaint. Each tipper is entitled to a part of the monies collected under the FCA's whistleblower procedures. The DOJ, California, Gold Coast, and Ventura County have reached a settlement deal, and Maithel and Galvan will receive 18.5 percent of the cash paid.
In accordance with Gold Coast's contract with the California Department of Health Care Services (DHCS), between January 2014 and May 2015, the four entities allegedly submitted false claims for payments for medical expenses that were not authorized. These expenses included services provided to adult patients who were previously uninsured between the ages of 19 and 64.
According to a press release from the office of California Attorney General Rob Bonta, the payments were predetermined sums that did not reflect the fair-market value of any additional services provided, were duplicate services already provided, and/or were not considered "allowed medical expenses" under Gold Coast's contract with the DHCS.
Gold Coast and Ventura County entered into five-year corporate integrity agreements as part of their settlements, the DOJ said. These agreements call for each party to implement "centralized risk assessment programs as part of their compliance programs and... hire an independent review organization to complete annual reviews."
In contrast to Ventura County, which would "target hospital claims submitted to Medicare and Medicaid, including claims submitted to Medicaid managed care organizations," Gold Coast will focus on its "calculation and reporting of medical loss ratio data" under Medi-Cal.
Gold Coast insisted that there was nothing improper about how it requested and received the payments.
According to a news release from the company's CEO, Nick Liguori, "although Gold Coast Health Plan believes that its disbursements to providers under this program were lawful and proper, we agreed to participate in a mediation with the regulators to reach a settlement to prevent an expensive and protracted process. The settlement reflects a compromise that will finally and fully resolve this dispute."
"Regulatory compliance is a cornerstone of our participation in the Medi-Cal program," added Robert Franco, Chief Compliance Officer of Gold Coast. "We have a robust compliance program, and the additional layers of oversight required by the corporate integrity agreement will further strengthen the health plan as we continue to adjust to the ever-evolving regulatory environment."
In a statement sent through email, Dignity Health similarly refuted the accusations and made no admission of guilt.
The statement read, "Dignity Health continues to maintain that all the reimbursement received was properly utilized in serving Ventura County’s Medi-Cal beneficiaries."
A Ventura County spokesperson issued the following statement in an email: "While the contract in question was audited and approved by the state of California, the federal government found that, in summary, due to the contract language, retroactive payments for services claimed under this contract were mistakenly made. All prospective payments for services rendered under the terms of the contract were not questioned."
"Much of the compliance work resulting from the settlement has already begun and will be fully implemented in the coming months," the statement continued.
An inquiry for comment from Clinicas received no response.
By fLEXI tEAM