The Office of the Inspector General (OIG) continues to focus on Medicare Advantage (MA) risk adjustment payments, issuing a report this week detailing its audit of MA risk adjustment payments based on acute stroke diagnosis codes that do not have corroborating hospital records. OIG found that submissions for 97 out of 100 sample enrollees were not supported in the enrollee’s medical records, estimating $462 million in potential net overpayments in 2021. Unlike prior OIG audits assessing various high-risk diagnoses submitted by a single MA plan, this report focuses on a single condition across multiple plans. While the audit is not without its limitations, it is another signal that MA organizations should consider implementing proactive measures to ensure the accuracy of acute stroke diagnosis codes (in addition to other high-risk diagnosis codes) prior to submission to Centers for Medicare & Medicaid Services (CMS) and expect to continue seeing code-level audits from OIG.

The Civil Division of the US Department of Justice (DOJ) recently issued a memorandum outlining unprecedented reforms aimed at accelerating the review and pursuit of certain qui tam complaints filed under the False Claims Act (FCA). Among other things, DOJ has announced that it will complete its review of new “benefits fraud” complaints — those alleging fraud against “federally funded, state-administered benefits programs” — within 120 days. Although the new policy seems based on unrealistic expectations, health care companies and providers should be prepared for a new normal in the pace of certain FCA investigations and an increase in litigation led by relators rather than the federal government. 

Explore 2025 managed care enforcement trends under the Trump administration. Learn about DOJ and CMS priorities, Medicare Advantage risk adjustment cases, key cases interpreting regulatory changes, and compliance strategies for MAOs.

In United States v. Regeneron Pharmaceuticals, Inc., the First Circuit joined the emerging majority view that False Claims Act (FCA) claims based on violations of the Anti-Kickback Statute (AKS) require a showing of “but-for” causation.  As we previously reported, the Sixth Circuit and the Eighth Circuit have also held that the stricter “but-for” causation standard applies to AKS-based FCA claims.

A recent Massachusetts Federal District Court decision adds to divergent opinions deciding an important health care enforcement question: what causation standard applies to a False Claims Act (FCA) case based on a violation of the Anti-Kickback Statute (AKS)? The AKS states that a claim that includes items or services “resulting from” a violation of the AKS constitutes a “false or fraudulent claim” under the FCA. 42 U.S.C. § 1320a-7b(g). On September 27, 2023, Chief Judge Saylor of the District of Massachusetts issued a decision in United States v. Regeneron Pharmaceuticals, Inc., C.A No. 20-11217-FDS, which adopted a “but-for” standard of causation applicable to the AKS’s “resulting from” language.