Independence Blue Cross agreed to pay $2.3 million to resolve accusations that two of its subsidiaries incorrectly calculated Medicare plan costs for CMS, leading to inflated reimbursement.
CMS contracts with Medicare Advantage plans to help manage coverage for Medicare beneficiaries. The U.S. Justice Department said Sept. 3 that Independence's Keystone Health Plan East and QCC Insurance Co. didn't correctly calculate its actual costs before submitting bids to CMS, leading the agency to overpay for the 2009 and 2010 contract years.
The settlement resolved a lawsuit filed by an Independence employee under the False Claims Act. Using the whistleblower provision of the False Claims Act, the employee, Eric Johnson, will receive nearly $500,000 of the settlement.