Whistleblower Receives $2.8 Million in $14.9 Million Upcoding Settlement

Upcoding Whistleblower

On June 5, Bluestone Physician Services of Florida LLC, Bluestone Physician Services, P.A., and Bluestone National LLC agreed to pay $14.9 million to settle allegations of submitting false claims for certain Evaluation and Management (E&M) codes inconsistent with Medicare, Medicaid and TRICARE requirements.

E&M codes are used by healthcare professionals to indicate services provided and the condition of a patient. The DOJ alleged that Bluestone submitted claims for two E&M codes between 2015 and 2019 to inappropriately inflate claims as a way of boosting profits. Principal Deputy Assistant Attorney General Brian M. Boynton explained: “Improperly billing federal health care programs depletes valuable government resources used to provide medical care to millions of Americans.”

The former General Manager for Bluestone’s Florida market, Lisa Loscalzo, filed a qui tam action in April of 2020. Under the qui tam, or whistleblower, provisions of the False Claims Act, a private party can file an action on behalf of the U.S. and be eligible to receive 15-30% of any recovery.

Loscalzo is set to receive $2,831,380 in connection with the settlement.

Bluestone provided primary and geriatric health care services in Florida, Minnesota, and Wisconsin. Patients of Bluestone included residents of assisted living facilities, group homes, and memory care units.

The government alleged that Bluestone submitted claims for payment to the Medicare Program domiciliary rest home visit code for established patients (99337) and for the chronic care management code (99490) “that did not support the level of service provided.” U.S. Attorney Andrew M. Luger for the District of Minnesota stated that this was referred to as “upcoding and unnecessary billing.”

As part of the settlement, Bluestone has entered into a five-year Corporate Integrity Agreement (CIA) with the Department of Health and Human Services, Office of Inspector General (HHS-OIG). Special Agent in Charge Mario M. Pinto of the HHS-OIG stated that this agreement is to help ensure “the public’s trust in our nation’s medical providers” and continue to uphold “the integrity of federal health care programs.” Bluestone must submit to an Independent Review Organization which will determine if the filed claims were medically necessary, appropriately documented, and correctly coded.

The government continues to urge individuals to aid in combating healthcare fraud. The False Claims Act is one of the most powerful tools in this effort.

On July 25, a bipartisan group of senators introduced the False Claims Amendments Act of 2023, which address a few technical loopholes undermining the success of the FCA. The bill is widely supported by whistleblower advocates.

National Whistleblower Center (NWC) has issued an Action Alert calling on Congress to pass the bill.

Join NWC in Taking Action:

Demand that Congress strengthen the False Claims Act

Further Reading:

Chronic Disease Management Provider to Pay $14.9M to Resolve Alleged False Claims

Bipartisan Legislation Unveiled to Strengthen False Claims Act

More False Claims Act Whistleblower News

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