A Los Angeles-area radiology group has agreed to pay nearly $2.4 million as part of a $62.8 million whistleblower False Claims Act lawsuit involving higher-paying diagnoses codes and radiology report addenda to support them, according to the U.S. Attorney’s Office in the Central District of California.
Renaissance Imaging Medical Associates (RIMA), a Northridge-based radiology group, worked with Seoul Medical Group and its subsidiary Advanced Medical Management, headquartered in the Koreatown area of Los Angeles. The case stems from false diagnosis codes for two severe spinal conditions — spinal enthesopathy and sacroiliitis — and inflated risk scores of Medicare Advantage (MA) beneficiaries, according to details in the U.S. Department of Justice (DOJ) settlement.
The claims and corresponding radiology reports allegedly created by Renaissance resulted in increased risk-adjusted payments from the Centers for Medicare and Medicaid Services to an MA plan; a portion of those increased payments was passed along to Seoul Medical Group, according to the DOJ announcement on March 26.
U.S. attorneys contended that Seoul Medical Group, Advanced Medical Management, and its founder and now former president, Min Young Cha, MD, knowingly submitted or caused to be submitted claims for payment from 2016 through 2022 for patients who did not suffer from either spinal enthesopathy or sacroiliitis.
When Seoul Medical Group was questioned about its use of spinal enthesopathy, the company enlisted the assistance of RIMA to create radiology reports that appeared to support the spinal enthesopathy diagnosis, according to the DOJ.
RIMA radiologists added the term “spinal enthesopathy” or “enthesopathy” into addenda for more than a hundred radiology reports that were years old with the knowledge that Seoul Medical Group would use the RIMA documentation to support its submission of spinal enthesopathy diagnosis codes on Medicare claims for the beneficiaries, even though the beneficiaries’ medical records did not otherwise support the submission of a diagnosis of spinal enthesopathy, RIMA’s settlement stated. RIMA denied the allegations but agreed to pay the U.S. $2.4 million.
Although there has no admission of liability by Seoul Medical Group, Advanced Medical Management, and Cha, they have agreed to pay $60.5 million to resolve the claims against them, with Cha paying $1.76 million, of which $880,000 is restitution.
The civil settlement resolves claims brought under the qui tam or whistleblower provisions of the False Claims Act by the former vice president and chief financial officer of Advanced Medical Management. The action was filed June 10, 2020.