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6 Military Healthcare Plans Sued For Overpayments 

18 Mar, 2024 F.J. Thomas

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Sarasota, FL (WorkersCompensation.com) – The U.S. Justice Department recently announced a complaint has been filed against six healthcare companies under the Tricare program, along with their trade group, and the government consulting firm allegedly responsible, for violating the False Claims Act. 

The US Family Health Plan alliance is a network of health plans that provide health coverage for active duty family members, activated National Guard and Reserve family members, and retirees and their family members under the Uniformed Services Family Health Plan (USFHP) program. Under the federal agreements, the Department of Defense (DOD) pays the healthcare plans a capitated rate. Additionally, the plans are not allowed to receive more than if the patient had received care directly through a military treatment facility, Tricare, or Medicare.

The complaint alleges that the US Family Health Plan Alliance, which includes Brighton Marine Health Center, CHRISTUS Health Services, Johns Hopkins Medical Services Corporation, Martin’s Point Health Care, Pacific Medical Center and St. Vincent’s Catholic Medical Centers of New York, were overpaid by the DOD, as the result of a calculation error, from 2008 to 2012 for members over age 65.

Kennell and Associates Inc., a research and consulting firm specializing in healthcare policy analysis of Federal healthcare programs, was retained by the DOD to calculate payment adjustments for the payers. The firm made two errors in their calculations of Health Status Adjustments used to determine payout. According to the complaint, in June 2012 Kennell & Associates, as well as the health plans, became aware of the calculation error which resulted in massive overpayments and payments above the limitations. Allegedly, the health plans continued to submit over inflated claims for several months afterwards. At the time of the discovery, the lawsuit states neither the plans nor the analyst firm informed the government about the overpayments. Overpayments are estimated at over a million dollars per year.

It wasn’t until the qui tam complaint was filed by Jane Rollinson and Daniel Gregorie that the government discovered the overpayments. Rollinson had acted as former Interim Chief Financial Officer for Martin’s Point. Gregorie had served as a consultant to Martin’s Point CEO and Board, and later served on its Board of Trustees. The lawsuit is seeks to recover the overpayments, treble damages and civil penalties.

Kennell and Associates have entered into an agreement which resolves allegations that they failed to notify the government of the overpayments. The firm has agreed to pay out $779,951, plus interest, and will pay an additional amount through 2025, contingent on Kennell and Associates’ ability to pay.


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    About The Author

    • F.J. Thomas

      F.J. Thomas has worked in healthcare business for more than fifteen years in Tennessee. Her experience as a contract appeals analyst has given her an intimate grasp of the inner workings of both the provider and insurance world. Knowing first hand that the industry is constantly changing, she strives to find resources and information you can use.

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