Consumer Fraud

Whistleblowers Claim United Healthcare Defrauded Medicare

Pills Stethascope on Money 435x289 Whistleblowers Claim United Healthcare Defrauded MedicareA whistleblower lawsuit against United Healthcare Services Inc., which operates the largest private Medicare Advantage plan, was unsealed in Wisconsin recently, revealing allegations that the insurer defrauded Medicare by collecting bonuses to which it was not entitled, among other accusations.

Whistleblowers James Mlaker of Milwaukee and David Jurczyk of Waterford, Wisconsin, filed the lawsuit last October under the False Claims Act, which authorizes private parties to sue on behalf of the U.S. government in cases of suspected fraud against taxpayer-funded government agencies and programs.

According to Kaiser Health News, Mr. Mlaker is a former sales agent for United’s Medicare Advantage plan and David Jurczyk formerly worked as a sales manager with the insurer. A federal judge unsealed the complaint as United Healthcare and other Medicare Advantage plans face multiple similar False Claims Act whistleblower suits.

The lawsuit contends that United kept a “dual set of books,” actually complaint databases, which the plaintiffs described as “the accurate one with a complete list of complaints and more details of the offenses and the fraudulent, truncated one provided to CMS (Centers for Medicare & Medicaid Services).”

United hid customer complaints so it could collect higher bonuses from the government, the lawsuit alleges. Medicare paid United $1.4 billion in bonuses in fiscal 2016 based on its self-reported high-quality ratings, compared with $564 million in 2015. CMS does not verify the accuracy of these reports before issuing bonus payments.

According to Kaiser Health News, United disclosed only one-third of its serious customer complaints to CMS in order to “fraudulently obtain” higher bonuses.

Additionally, United falsely declared consumer complaints as “inconclusive” or “unsubstantiated” on a regular basis. According to the lawsuit, about 84 percent of complaints alleging major infractions were deemed either inconclusive or unsubstantiated and dismissed. Some internal inquiries were intentionally dragged out by United, the lawsuit alleges.

When potentially damaging facts were found, United often ignored them or falsified its findings, the whistleblowers allege, according to Kaiser Health News.

In one case, a sales agent forged patient signatures on United’s Medicare Advantage plan enrollment forms without the patient’s knowledge or consent. Another agent engaged in a “brazen kickback scheme” promising potential customers iPads if they enrolled and stayed with the program for at least six months, the whistleblowers allege.