Martin&apos;s Point Health Care to pay $22 million to settle Medicare fraud claims

Martin's Point Health Care in Portland has agreed to pay more than $22 million to the U.S. government for alleged Medicare fraud that was brought to light by a whistleblower within the company.

Of that total, $3.8 million will be paid to Alicia Wilbur, a former manager at Martin's Point from mid-2016 through late 2017 who filed the complaint against the company in June 2018. Her complaint was unsealed in federal court Monday, where the terms of the settlement also were filed. It was the largest Medicare fraud settlement in state history, the U.S. Attorney's Office in Maine told The Associated Press.

Wilbur informed her superiors numerous times about inflated payments for Medicare services, but she was rebuffed, according to court documents that detail problems with the billing that date to 2013. Attempts to reach Wilbur through her attorney were unsuccessful Monday.

Martin's Point would routinely code patients' historical health conditions – such as for cancers, strokes and heart conditions – as active conditions, according to court records. That generated additional revenue for the nonprofit that it was not entitled to receive from the Medicare Advantage program.

Medicare Advantage is supplemental insurance for patients who have Medicare coverage – typically those 65 and older – that covers costs Medicare doesn't pay for, such as vision, hearing and dental, drug costs not covered by Medicare, and other health services not covered.

"Martin's Point repeatedly pressured and directed employees and contractors to ignore unsupported codes – such as coding historical conditions as active – because deleting those codes would hurt profitability," the complaint alleges.

Martin's Point provides primary care to patients at six locations: Portland, Biddeford, Brunswick, Scarborough, Gorham and Portsmouth, New Hampshire. It also offers a Medicare Advantage plan that covers about 60,000 members.

From 2016 to 2019, Martin's Point assigned additional diagnoses to patients in order to get higher reimbursements using information that was not supported by medical records, Wilbur alleged in her complaint.

"Medicare Advantage programs rely on accurate health information to provide the best health care and proper payment from the federal government," said Amy L. Easton, an attorney who represented Wilbur. "Inaccurate diagnosis codes distort both the delivery of health care and government payment for that health care."

Martin's Point billed Medicare for medical conditions such as diabetes, obesity, congestive heart failure, heart arrhythmias, vascular disease, rheumatoid arthritis and other conditions "of which a significant percentage were unsupported based on the underlying medical records," according to court records. Martin's Point "submitted these erroneous codes knowingly" and received payments "to which it was not entitled," the settlement agreement said.

"Stunningly, in 2017, when Martin's Point retroactively reviewed a sample of three years of medical charts, it found that the patients did not have (or the charts did not support) 60% of the illnesses reported to, and paid by (the Center for Medicare and Medicaid Services)," the complaint reads. "In response, Martin's Point did nothing: it did not investigate further, broaden its sample size nor look for these errors in prior time periods. On information and belief, it did not even notify CMS and kept the resulting overpayments."

'NO IMPACT TO OUR PATIENTS OR MEMBERS,' MARTIN'S POINT SAYS

Steve Amendo, chief marketing officer for Martin's Point Health Care, released a statement on behalf of the organization that said "claims resolved by the settlement are allegations only, and there has been no determination of liability."

"The settlement is not related to member care or the payment of member claims. Martin's Point worked collaboratively with the (Department of Justice) during the course of the investigation," the statement says. "Despite denying liability for the litigation claims at issue, Martin's Point ultimately determined that settlement of this matter was appropriate rather than engaging in the cost and uncertainty of protracted litigation.

"This settlement is not an admission of liability, it instead allows us to avoid the disruption, expense and uncertainty of litigation," Amendo continued. "This resolution allows us to put the past behind us, and we remain committed to our patients and members across our service regions and to the regulatory agencies that oversee our work."

The statement by the health care nonprofit also said that "Martin's Point Health Care is committed to the integrity of our work, mission, and service to our patients and members. Since 2019, Martin's Point has taken steps to strengthen and develop new risk adjustment processes. Additionally, under the direction of new executive and senior leadership, the organization has established a team of experienced personnel specifically tasked with oversight of all risk adjustment practices.

Amendo, in an email response to questions about the allegations, said that "Martin's Point will continue to operate with no impact to our patients or members."

According to the most recent publicly available Internal Revenue Service 990 form – from 2021 – Martin's Point reported $551 million in revenue and $479 million in expenses, ending the year with a $71 million surplus.

Amendo's email also said that "Martin's Point adheres to responsible financial stewardship practices, and we are well-prepared for circumstances such as this. Our overall organizational financial position remains strong and this has no implications for our day-to-day operations."

Dr. David Howes, former president and CEO of Martin's Point, earned $937,418 in 2021, three years after Wilbur's initial court filing. His income was $643,509 in 2014 before ballooning to about $860,000 in 2015. Howes' salary fluctuated after that, but was generally about $900,000 per year.

It was unclear according to the 2018 court filing how much Howes knew about the alleged overpayments, but in one passage it said Howes, along with another executive, either "knew or recklessly disregarded or were deliberately ignorant" of "high error rates uncovered by audits."

Attempts to reach Howes were unsuccessful Monday.

Dr. Paul Kasuba replaced Howes as president and CEO in 2022, according to a Martin's Point news release. Kasuba was not mentioned in any court documents as being involved in the Medicare Advantage reimbursement system.

Ed McKersie, chair of the Martin's Point board of directors, refused to comment on the settlement when contacted Monday, referring questions to Amendo.

Problems with Medicare Advantage overbilling have become widespread, according to an October, 2022 article in The New York Times, with eight of 10 of the largest Medicare Advantage insurers having submitted inflated bills, a recent analysis by federal audits shows. A separate analysis estimated $12 billion in overpayments in the Medicare Advantage program in 2020, The New York Times reported.

Justin Ward, executive vice president of Gray-based Patient Advocates, which assists people with medical billing issues, said the complex coding system, if used improperly, can lead to "millions in overpayments." Ward said their group does not work with clients who have Medicare Advantage plans.

"One reform that could help would be giving patients unfettered access to their complete medical records, at any time," Ward said.

'REVENUE MAXIMIZATION'

According to the 2018 court filing "Martin's Point knew that physician-supplied diagnosis codes were often inaccurate, and dedicated numerous resources to reviewing the charts and physician-supplied diagnosis codes in order to capture missing codes. Conversely, little to no resources were dedicated to correcting unsupported codes that resulted in overpayments."

Martin's Point "dedicated an entire internal unit and hired third-party vendors to capture codes that physicians may have missed" doing so "under the guise of promoting accuracy." However, "the aim of these activities was purely revenue maximization, not accuracy," the 2018 court filing states.

Although the terms of the settlement allow Martin's Point to avoid liability, it does not release the company from the possibility of criminal charges.

The Office of Public Affairs for the Justice Department did not respond to questions Monday on how the settlement will be used, and if Martin's Point is responsible for reimbursing Medicare Advantage patients if they were overbilled. The department also did not respond to inquiries on how the settlement compares to others related to the False Claims Act, or whether prosecutors are considering criminal charges.

The U.S. Attorney's Office for the District of Maine helped coordinate the settlement along with other agencies, according to the DOJ, but they referred all questions to the Justice Department.

"The government expects those who participate in Medicare Advantage to provide accurate information to ensure that proper payments are made for the care received by enrolled beneficiaries," Deputy Assistant Attorney General Michael D. Granston said in a statement Monday. "Today's result sends a clear message to the Medicare Advantage community that the United States will take appropriate action against those who knowingly submit inflated claims for reimbursement."