Last month, Medicare Advantage provider and physician, Beaver Medical Group, LP and Dr. Sherif Khalil, agreed to pay over $5M to settle a qui tam action brought by a former physician at Beaver Medical Group. The whistleblower alleged that Dr. Khalil and the practice provided fraudulent diagnoses to Medicare Advantage Organizations ("MAOs"). Medicare pays MAOs based on the health status of the beneficiaries. Medicare pays MAOs more if the patients are sicker.
"MAOs often contract with physician groups and other healthcare providers to provide care to Medicare beneficiaries enrolled in their plans. These healthcare providers report diagnoses and other information to the MAOs, which the MAOs then submit to Medicare in order to obtain higher risk-adjusted payments."
"In this case, several MAOs in California contracted with Beaver to provide health care to Medicare beneficiaries enrolled in their plans. The MAOs often compensated Beaver with a share of the payments that the MAOs received from Medicare for the beneficiaries under Beaver's care. Thus, Beaver had a financial incentive to submit additional diagnosis codes to the MAOs in order to increase the payments that the MAOs received from Medicare. The settlement resolves allegations that Beaver and Dr. Khalil knowingly submitted diagnoses that were not supported by the beneficiaries' medical records in order to inflate the payments that the MAO received from Medicare."
To see the full press release, click here.