DOJ urges judge to keep alive whistleblower lawsuit against UnitedHealth Group

The U.S. Department of Justice is pushing forward with a whistleblower lawsuit against UnitedHealth Group, despite a special master’s report in March backing the company by finding the case suffered from a “complete failure” of evidence.

Over a period of several years, the Eden Prairie-based health care giant asked its medical coders to scour records and find missing diagnosis codes. The process generated $7.2 billion in additional payments to the company’s Medicare Advantage health plans, which are paid extra to cover sicker patients, according to a Wednesday court filing by the Justice Department.

Yet when those same coders found medical records that did not support 1.97 million previously submitted medical codes, the company did not report that information to the government, and ultimately kept $2.1 billion to which UnitedHealth was not entitled, the Justice Department’s new filing says.

“The Special Master’s Report and Recommendation blesses that conduct ... [and] is fundamentally flawed,” according to the memorandum filed with the U.S. District Court for the Central District of California.

Wednesday’s filing is the latest volley in a whistleblower case that originally was filed under seal in March 2011 by Benjamin Poehling, a former director of finance who started working for UnitedHealth Group in Minnesota in 2004. The Justice Department later joined the case as plaintiff against UnitedHealth.

Special Master Suzanne Segal issued a report in early March concluding the case should be decided in UnitedHealth’s favor without a trial because the government hadn’t presented evidence from which a jury could reasonably conclude diagnosis codes UnitedHealth Group submitted were invalid and not supported by the related medical record.

“The complete failure of any evidence on this essential element must result in summary judgment for United,” Segal wrote.

The federal judge in the case will need to consider Segal’s recommendation and ultimately decide whether to grant the company’s motion for summary judgement, handing a victory to UnitedHealth without going to a trial.

In the new filing the Justice Department urged the judge to keep the case alive, saying Segal disregarded the findings about UnitedHealth’s coders because she wrongly credited contradictory information from the company.

“The weighing of conflicting admissible evidence is the exclusive province of a jury and is improper on a motion for summary judgment,” the government contends.

In addition, the Justice Department argues the special master wrongly read a new requirement into the reverse False Claims Act provision in federal law. As such, the government asked the court to decline the adoption of Segal’s report.

UnitedHealth Group did not immediately respond to a request for comment.

In a court filing last year, the company said the Justice Department is wrong for asserting that if UnitedHealth coders who reviewed a chart did not identify a diagnosis code, then this necessarily means a doctor who previously certified and submitted the same code on a claim form must have done so in error.

“In DOJ’s view, if a doctor’s office submitted a ‘diabetes’ code on a claim form after seeing a patient, but United coders did not code ‘diabetes’ in reviewing the medical chart for the date of that claim, then the diabetes code must be invalid,” UnitedHealth Group said in the filing. “DOJ believes that, in this situation, the United coders were always right, and the doctor’s office — where the patient was seen and where the doctor certified the code — was always wrong.

“The problem with DOJ’s categorical theory is that it is not supported by any evidence.”

The company has until May 2 to respond in court to the Justice Department filing. The judge in the case is scheduled to consider the special master’s report at a hearing on June 5.