$56.5M Settlement in Medicare Advantage Fraud Case

Matrix Medical Network and its affiliate, HealthFair, alongside Shahriah “James” Ekbatani, have reached a $56.5 million settlement over allegations under the False Claims Act. The claims involve the improper submission of diagnosis codes to Medicare Advantage, impacting risk-adjusted payment calculations. Of the total settlement, Matrix, which conducts in-home assessments for Medicare Advantage Organizations (MAOs), will pay $36.5 million. HealthFair, known for mobile health assessments, contributes $5 million, with Ekbatani agreeing to a $15 million payment.

The allegations indicate that between 2014 and 2019, Matrix facilitated the inclusion of unsupported diagnoses such as proliferative diabetic retinopathy in submissions to CMS, resulting in inflated CMS payments to MAOs. HealthFair, under Ekbatani’s direction, submitted inadequately documented diagnoses from 2015 to 2017, contributing to excessive MAO reimbursements. The settlements resolve claims brought forward by whistleblowers, including former Matrix employee Nancy Cahill and HealthFair's chief medical officer, Robert Oristaglio, Jr., D.O., who will receive a share of the proceeds.

This resolution reflects ongoing efforts to ensure regulatory compliance and integrity within the Medicare Advantage framework. Key agencies involved include the Justice Department’s Civil Division and U.S. Attorney’s Offices in New York and Texas, supported by the Office of Inspector General of the Department of Health and Human Services. These actions are part of a broader initiative to combat fraud in federally funded healthcare programs, reinforcing the integrity of Medicare Advantage operations. Task forces and enforcement operations continue to target fraudulent activities that affect federal healthcare funds.