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Martin’s Point Health Care Settles Medicare Part C Case

August 8, 2023

Martin’s Point Health Care Inc. (“Martin’s Point”), headquartered in Portland, Maine has agreed to pay $22.5 million to resolve allegations brought under the qui tam or whistleblower provisions of the False Claims Act.  Alicia Wilbur, a former manager in Martin’s Point’s Risk Adjustment Operations group, filed the whistleblower case in 2018. According to the DOJ’s press release, Martin’s Point, a Medicare Part C Plan, intentionally upcoded diagnoses for its enrollees to increase its Medicare reimbursements.

Understanding Medicare Advantage and Risk Scores

Medicare Advantage, also known as the Medicare Part C program, offers beneficiaries the option of enrolling in managed care insurance plans called Medicare Advantage Plans (MA Plans).  The Center for Medicare and Medicaid Services (CMS) pays the plans a per-patient amount. In return, the plans provide Medicare-covered services to the enrolled beneficiaries. CMS pays an amount based on each patient’s demographic information and diagnoses. These adjustments are referred to as “risk scores.” Beneficiaries with more expensive-to-treat diagnoses have higher risk scores. The higher the beneficiaries’ risk scores, the larger the risk-adjusted payments to the MA Plans responsible for their care.

Part C Plan Allegedly Submitted Higher Risk Scores for Larger CMS Payments

According to the government, between 2016 and 2019, Martin’s Point operated Medicare Advantage plans for beneficiaries residing in Maine and New Hampshire. During this period, Martin’s Point engaged in chart reviews of its Medicare Advantage beneficiaries. The chart reviews were done to identify additional diagnoses codes that could be submitted to Medicare. The whistleblower, however, alleged that many of the patients’ medical records did not support these additional codes.

Despite this lack of proper documentation, Martin’s Point allegedly submitted these diagnoses codes, leading to higher payments from CMS. This practice, known as “upcoding,” is illegal and can significantly impact the financial integrity of government healthcare programs like Medicare Advantage.

It is a privilege for health plans to provide services to Medicare beneficiaries, not a right. Medicare Advantage Plan sponsors that submit inaccurate claim information in order to justify inflated payments undermine the financial integrity of the program. HHS-OIG remains committed to protecting taxpayer-funded health care programs, including Medicare Advantage.

-Deputy Inspector General for Investigations Christian J. Schrank, Department of Health and Human Services, Office of Inspector (HHS-OIG).

Fighting Medicare Part C Fraud is a Priority

Combatting fraud in the Medicare Advantage program is a government priority.  The DOJ emphasized this focus in a press release in February 2022.  There have been many lawsuits and settlements with Medicare Part C plans like Martin Point.  WLC was at the forefront of this work with its $137.5 million Wellcare settlement in 2012.  More recently, in her prior role at the U.S. Attorney’s Office for the Northern District of California, WLC attorney Erica Blachman Hitchings ran two cutting-edge Medicare Advantage fraud government investigations.  Unlike cases against Part C Plans, these cases also named prestigious, nonprofit physician groups as defendants for their role in the misconduct.  One such case against Sutter Health resolved for $90 million.  The other, against Kaiser Permanente, remains in litigation, with the government seeking over $1 billion in damages.

As the Washington Post reported in July 2022, Medicare Part C plans cover an ever-increasing portion of the Medicare-eligible population.  In 2011, 26 percent of Medicare beneficiaries enrolled in the Medicare Advantage program.  By 2021, that number grew to 46 percent, or over 26 million individuals.  With so many beneficiaries enrolled — and so much money at stake — Part C fraud is bound to continue for years to come.

Whistleblowers and the False Claims Act

The False Claims Act remains one of the most potent tools in the government’s efforts to combat healthcare fraud. It encourages individuals with knowledge of fraudulent activities to come forward and report potential fraud, waste, abuse, and mismanagement in the healthcare industry.  Successful whistleblowers may receive an award.  In this case, the whistleblower will receive approximately $3.8 million of the settlement as her reward.

Whistleblower Law Collaborative

The Whistleblower Law Collaborative LLC, based in Boston, devotes its practice entirely to representing clients nationwide in bringing actions under the federal and state False Claims Acts and other whistleblower programs.  Among the firm’s many successes is the government’s $217 million settlement with WellCare Health for upcoding in the Medicare Part C program, among other allegations.  If you are aware of healthcare fraud, we urge you to contact us for a free, confidential, consultation.



Client's False Claims Act case settles for $12.9 Million
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