medicare

Aug. 3 (UPI) — Florida-based Complete Health will pay a $14.1 million settlement stemming from allegations that it inflated patient diagnoses to overcharge Medicare, the Justice Department said Monday.

DOJ officials said from 2020 to 2023, the company routinely added bogus diagnosis coding to its billing — saying its patients had drug and alcohol dependencies as well as bipolar disorder — that “were not clinically valid.”

Under Medicare Part C, also known as Medicare Advantage, the government pays a fixed monthly rate to private health providers depending on the severity of a patient’s diagnosis.

This differs from Medicare parts A and B, in which a provider is paid fees per service.

DOJ said the Complete Health added the false diagnoses to receive a higher monthly premium per patient.

“Companies that attempt to improperly boost their own profits by reporting bogus medical conditions of Medicare Advantage enrollees — as alleged in this case — will be held responsible for their actions,” said Special Agent in Charge Isaac Bledsoe, of the Department of Health and Human Services Office of Inspector General, in a statement.

“Today’s settlement demonstrates our office’s commitment to safeguarding the integrity of federal health care programs, including Medicare Advantage, which exist to provide necessary care to enrollees, not as a vehicle for improper financial gain,” Bledsoe added.

Complete Health is a management services organization based in Jacksonville that operates in Florida, Alabama and Colorado.

“This settlement sends a strong message to our district, its residents, and medical providers doing business here, that our focus on this vital practice area has not wavered,” said U.S. Attorney Gregory Kehoe, of the Middle District of Florida, in a statement.

In the latest salvo in the war between the Trump administration and California, Health and Human Services Secretary Robert F. Kennedy jr. said Tuesday that his agency withheld $867.5 million in Medicaid payments to the state over concerns about fraud.

Kennedy also said his agency defered $199 million in Medicaid payments to Minnesota over similar concerns.

“If Gov. Gavin Newsom or Gov. Tim Walz wants this funding released, all they have to do is provide basic documentation showing that these services are legitimate and not fraudulent,” Kennedy said at a news conference.

Just under half of the funds withheld from California were in connection with in-home health services.

Dr. Mehmet Oz, the administrator for the Centers for Medicare and Medicaid Services, said California’s spending on in-home health services went up by more than double the national average over the last two fiscal years.

“That doesn’t make sense,” he said.

About a quarter of the funds withheld involved care provided to individuals with “unsatisfactory immigration status,” whose eligibility to be in the country and receive these services is in question, which Oz characterized as an “ongoing massive problem for California.”

The announcement by Kennedy and Oz on Tuesday comes two months after Vice President JD Vance announced that the administration would be deferring $1.3 billion in Medicaid payments over fraud concerns, largely connected to hospice services and in-home healthcare.

Newsom’s office, in a social media post, called the announcement a “recycled political stunt.”

“California isn’t being targeted because Trump has evidence of fraud,” the post said. “We are being targeted for political reasons — and because Dr. Oz doesn’t understand that we are *SAVING* taxpayers money by keeping seniors and people with disabilities out of far more expensive nursing homes!”

Newsom’s office also said that the state stands “ready to collaborate” with the Centers for Medicare and Medicaid Services “in good faith efforts to combat fraud.”

The office of California Atty. Gen. Rob Bonta said it is reviewing the deferral of payments and allegations of fraud.

“We have not hesitated to challenge unlawful actions by the Trump administration, and we will continue to act whenever Californians’ rights or access to critical services are threatened,” Bonta’s office said.

Despite Newsom’s claims that the accusations are political, the California state auditor has repeatedly flagged Medi-Cal eligibility discrepancies that have exposed the state to billions of dollars in questionable payments.

California Department of Healthcare Services spokesperson Anthony Cava noted, however, that a 2020 state audit of in-home care found “no program integrity concerns” and encouraged expansion of the program to reduce spending on institutional care.

Cava also pointed out that the federal government had previously approved California’s approach to in-home care.

Newsom and Oz have clashed before.

Newsom filed a civil rights complaint in January against Oz, after Oz posted a video to social media from Van Nuys in which he accused the “Russian Armenian mafia” of being a leading driver of $3.5 billion in fraud in hospice and home-care services.

Newsom said that Oz’s claims were “baseless and racist.”

The announcement by Kennedy and Oz on Tuesday is the latest effort by the Trump administration to crack down on suspected Medicaid fraud in numerous states across the country.