Milberg Representing City of Plaquemine in TeamHealth Medical Overbilling Lawsuit
by Brian Eckert
Attorneys for Milberg Coleman Bryson Phillips Grossman (“Milberg”) have filed a medical overbilling lawsuit on behalf of the City of Plaquemine, Louisiana against Team Health Holdings, Inc. for allegedly running a scheme that resulted in overpayment of health insurance claims.
The class action lawsuit asserts that the defendant violated the Racketeer Influenced and Corrupt Organizations (RICO) Act by intentionally and systematically overcharging insurance payors. It seeks to establish three payor classes and recover money damages for them. Milberg Senior Partner Greg Coleman of the firm’s Knoxville office is leading this action.
The City of Plaquemine covers its municipal employees, such as police officers and first responders, through a workers’ compensation health insurance plan.
TeamHealth, owned by private equity firm Blackstone, supplies emergency department (ED) medical staffing and administrative services to hospitals and other healthcare providers in 47 states. It has entered arrangements with numerous hospitals to replace local ED practice groups with its own outsourced staff.
TeamHealth is owned by private equity firm, Blackstone, which acquired the company in 2017 for $6.1 billion.
TeamHealth acts as an intermediary between healthcare workers, Medicare, insurance companies, and plans that pay for their services. It bills payors for the ED services its staffers provide.
When medical services are provided, the services are assigned a standardized health care billing code called a CPT code. Payors receive bills from medical service providers containing CPT codes that determine the amount owed.
TeamHealth, through its coding and billing entity, decides what codes to assign and how much to bill for its personnel’s services. After local medical staff completes their patient care, they submit medical records to TeamHealth, which assigns a CPT code for the work performed.
The country’s largest staffing firm for ER doctors, TeamHealth engages in “aggressive pricing,” according to a ProPublica investigation, to maximize profits and investor returns.
Milberg’s TeamHealth medical overbilling lawsuit was filed in U.S. District Court for the Eastern District of Tennessee on March 29, 2023. Over 60 pages, it details how TeamHealth allegedly submitted false insurance claims that resulted the City of Plaquemine overpaying for medical services.
This overbilling was the fruit of a deliberate business model and carefully reticulated scheme. The scheme makes the overbilling ordinarily undetectable because it is founded upon upcoding of “CPT codes” used to bill for services. Consultation with medical professionals, data mining, and a CPT coding expert is necessary to uncover the fraud.
The allegations described in the complaint paint a pattern of fraudulent billing that unfolded in the following manner:
- TeamHealth promises hospitals, physicians, and ER staff that it will improve efficiency and profitability and remove administrative burdens from practitioners’ shoulders.
- Once TeamHealth becomes involved in billing, it uses an intentionally obfuscated scheme to obtain overpayments from payors.
- Overpayments are procured using improperly chosen CPT codes in conjunction with billing.
- Payors accept claims for payment and rely on the CPT codes assigned by TeamHealth.
- As a result of TeamHealth’s false representations, payors pay higher amounts than are properly due.
- TeamHealth perpetrated this alleged scheme in order to generate additional profits.
- CPT code-based billing statements are transmitted across state lines and therefore constitute a RICO offense.
The complaint notes that other lawsuits make similar allegations about TeamHealth’s overbilling practices. Celtic Insurance Company, for example, alleged in a recently-settled lawsuit that TeamHealth “upcoded” nearly two-thirds of the medical bills that used a specific CPT code, while UnitedHealthcare Services claims in an ongoing case that the same CPT code was wrongly applied in 75% of the claims TeamHealth submitted to them.
“It begs credulity to conclude that over recent years TeamHealth was billing Celtic and United Healthcare overcharges between 62% and 75% of the time on CPT code level 5 bills, while not doing the same” with regard to the City of Plaquemine plan, the complaint states.
The TeamHealth medical overbilling lawsuit seeks class action status and the following representative classes:
- RICO Class: All payors or their assignees that compensated TeamHealth or an entity billing on its behalf for medical treatment in the United States or its territories during the four years prior to the filing of the complaint.
- Unjust Enrichment Class: All payors or their assignees that compensated TeamHealth or an entity billing on its behalf for medical treatment in the United States or its territories during the three years prior to the filing of the complaint.
- Declaratory Judgment Class: All payors or their assignees that compensated TeamHealth or an entity billing on its behalf for medical treatment in the United States or its territories at any time prior to the filing of the complaint.
The lawsuit excludes U.S. government programs like Medicare, Medicaid, and Tricare as class members.
Milberg: A National Leader in Class Actions
Payors that meet class criteria do not have to hire a lawyer or take any action at this time. Milberg is representing all class members on a contingency basis. If the class is certified and a settlement or verdict results, class members could be automatically in line to receive payment for overcharged medical services.
Milberg pioneered federal class action litigation and remains a national leader in the area. Since 1965, we have filed thousands of class action lawsuits and recovered billions of dollars for our clients.
Mr. Coleman is listed in The Best Lawyers in America, has been named one of the Top 100 Trial Lawyers by the American Trial Lawyers Association, and has been recognized as one of Knoxville’s Top Attorneys in six separate categories.