Illinois Court Fines Insurer for Medicaid Fraud
A federal jury in Chicago on Monday ordered Virginia-based health insurer Amerigroup, to pay $48 million in damages for discrimination against pregnant women and other beneficiaries with health issues, the Chicago Tribune reports. The amount will triple to $144 million under the federal False Claims Act.
After two days of deliberations, the jury ruled that Amerigroup and subsidiary Amerigroup Illinois sought to increase profits by excluding beneficiaries with health issues from Medicaid managed care plans. The insurer had operated Medicaid managed care plans in Illinois until August when it withdrew operations from the state.
The case involved a federal whistleblower lawsuit filed by Cleveland Tyson, an Amerigroup official fired in 2002 who will receive between $21 million and $36 million of the damage award. According to prosecutors, from 2000 to 2003, Amerigroup received $243 million in Medicaid reimbursements and misinformed the state that company Medicaid managed care plans enrolled eligible beneficiaries without consideration of their health status.
Prosecutors said that Amerigroup trained marketing representatives to avoid Medicaid beneficiaries with high medical bills and had a policy of "cherry picking" beneficiaries without health issues.
Prosecutors submitted a number of e-mails and statements from Amerigroup officials as evidence in the case. In a 2001 e-mail, the director of medical management for Amerigroup Illinois wrote to company managers, "Please keep up the good work with the marketing reps of not trying to sign up pregnant women."
Attorneys for Amerigroup argued that the company had not discriminated against pregnant women or other Medicaid beneficiaries with health issues and never misinformed the state about company marketing practices.
Illinois Attorney General Lisa Madigan said, "The verdict will both reimburse the State of Illinois for the money Amerigroup obtained illegally and punish Amerigroup for their unconscionable conduct."
Amerigroup spokesperson Kent Jenkins said that the company will appeal the verdict. Jenkins said, "We think that during the course of the trial there were errors that led the jury to consider information that was inaccurate, incomplete and misleading" (Bush, Chicago Tribune, 10/31).