UPCODING FRAUDSTER NEEDS TO PRODUCE DOCUMENTS DEMANDED

Post number 5282

See the video at https://rumble.com/v75lv48-insurers-must-be-proactive-when-victims-of-fraud.html  and at https://youtu.be/LxKCyb7qeZ0

Health Insurance Fraud Can Be Stopped by Aggressive Insurers

In Unitedhealthcare Services, Inc., United Healthcare Insurance Co., and UMR, Inc. v. Team Health Holdings, Inc., Ameriteam Services, LLC, and HCFS Health Care Financial Services, Inc., No. 3:21-CV-364-DCLC-DCP, United States District Court, E.D. Tennessee, Knoxville (February 2, 2026) Plaintiffs are health insurance providers and claim administrators who process and pay approximately one million claims daily, relying on automated adjudication and truthful information from providers.

FACTUAL BACKGROUND

Defendants, including Team Health Holdings, Inc., Ameriteam Services, LLC, and HCFS Health Care Financial Services, Inc., operate one of the largest emergency room staffing and billing companies in the United States. Defendants affiliate with or acquire medical groups nationwide, which contract with hospitals to staff emergency rooms.

The dispute centers on payments made from both fully insured and self-funded plans administered by Plaintiffs, with Plaintiffs alleging issues regarding over payments and the accuracy of claims submitted by Defendants.

LEGAL ISSUES

The parties are engaged in discovery disputes concerning requests for production of documents, as outlined in the Scheduling Order. Plaintiffs state that “[t]his lawsuit principally concerns a form of insurance fraud called ‘upcoding.’” They allege that “[u]pcoding occurs when a provider submits a claim to an insurer or claims administrator utilizing an inaccurate billing code in order to obtain higher payments.

DISCUSSION

The parties contested Defendants’ responses to several Requests for Production (RFPs) and Plaintiffs’ responses to others. Plaintiffs also sought supplemental responses and claimed certain documents had not been produced by Defendants.

ANALYSIS

Plaintiffs argue that the volume and automation of claims processing necessitate reliance on providers for accurate submissions and assert that Defendants’ affiliated medical groups are responsible for staffing and billing in hospital emergency rooms nationwide. The legal framework supports Plaintiffs’ authority to pursue overpayments.

Plaintiffs contend that Defendants have systematically upcoded claims for emergency room services. Plaintiffs state that providers generally bill emergency room services to insurers using consecutively numbered CPT codes from 99281 to 99285 and that higher numbers indicate more extensive and complex treatment billed at higher rates. CPT codes 99285 and 99284 denote treatment of especially serious issues, typically requiring the physician’s immediate, sustained, and undivided attention. The higher CPT code 99285 is reserved for relatively rare cases in which the patient is at imminent risk of death or loss of physiological function, and CPT Code 99284 denotes emergency care for particularly severe and complex but non-life-threatening medical issues.

According to Plaintiffs, Defendants block attempts by insurers and claims administrators to contract directly with their affiliated medical-groups, and demand independence from hospitals within which they operate in their dealings with insurers and claims administrators. They state that recently, Defendants have gained notoriety for their aggressive pursuit of profit at the expense of patient and insurers alike and that private equity firms generally, and Blackstone specifically, apply significant pressure to the companies they acquire such as Defendants to maximize near-term profits. Plaintiffs allege that Defendants’ own compensation structure amplifies this incentive.

The court ordered the production of relevant documents so that the Plaintiff may find that there is an attempt at fraud or not.

ZALMA OPINION

Upcoding fraud has taken billions of dollars from the insurance industry and federal insurance programs like Medicaid and Medicare that has resulted in multiple prosecutions of health care providers. In this case a private health insurer is attempting to protect itself from fraudsters and was hindered by refusal of the alleged fraudsters to properly present the evidence required by discovery rules. I am pleased that private entities have decided to not wait for the government to protect them by criminal prosecution and is proactively going after the fraudsters.

(c) 2026 Barry Zalma & ClaimSchool, Inc.

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