Health insurer Cigna Group has recently reached a settlement with the United States government concerning allegations that it overcharged the government’s Medicare Advantage program. The company was accused of artificially inflating the severity of patients’ medical conditions, making them appear sicker than they actually were, which resulted in overbilling the Medicare program.
Key highlights of this settlement include:
1. Settlement Amount: Cigna will make a payment of approximately $172 million as part of this settlement. This sum represents compensation for the alleged overbilling and the financial impact it had on the Medicare Advantage program.
2. Corporate Integrity Agreement: In addition to the financial settlement, Cigna has agreed to enter into a Corporate Integrity Agreement with the U.S. Office of Inspector General. This agreement is meant to ensure that the company follows rigorous compliance standards and that similar issues do not arise in the future. It typically involves ongoing monitoring and reporting to ensure compliance with healthcare regulations.
3. Legal Background: The legal case against Cigna was initiated by U.S. prosecutors in Manhattan in October 2022. They accused the Connecticut-based health insurer of obtaining tens of millions of dollars in Medicare funds between 2012 and 2019 by submitting false diagnoses for patients. These false diagnoses were allegedly associated with cases where healthcare providers contracted by Cigna did not conduct the necessary medical tests, leading to improper billing.
4. Medicare Advantage Program: The Medicare Advantage program is a government health insurance program that primarily serves individuals aged 65 and older. It offers an alternative to traditional Medicare by allowing private health insurance companies like Cigna to provide coverage to Medicare beneficiaries. These insurers are paid a per-patient fee, and the government reimburses them for the healthcare services provided to Medicare Advantage enrollees.
Cigna’s settlement with the U.S. government involves a substantial financial payment and a commitment to adhere to a Corporate Integrity Agreement. This agreement is intended to ensure compliance with healthcare regulations and prevent similar overcharging issues in the future. The case underscores the importance of accurate and transparent billing in healthcare programs like Medicare Advantage.