On May 11, 2017, a False Claims Act complaint was filed and settled against benefits management company CareCore National LLC (“CareCore”), now part of eviCore healthcare, for not properly assessing over a period of at least eight years whether medical diagnostic procedures paid for with Medicare and Medicaid funds were necessary or reasonable before approving them.  Under the settlement, CareCore must pay a penalty of $54 million, with $45 million being paid to the United States and $9 million being paid to the states named as plaintiffs in the lawsuit.  According to the complaint, CareCore was unable to perform prior authorization review for medical diagnostic procedures in a timely fashion and, in order to avoid contractual penalties, CareCore developed the “Process As Directed,” or “PAD” Program by 2007, which directed clinic reviewers to improperly approve prior authorization requests.  Between 2007 and 2013, through the PAD program, CareCore improperly authorized over 200,000 diagnostic procedures.  The allegations in this case were brought to the attention of the government by a whistleblower who filed a lawsuit under the qui tam provisions of the False Claims Act.  United States ex rel. Miller v. CareCore National LLC, 1:13-cv-01177 (S.D.N.Y).

DOJ Press Release