In the government’s long-running False Claims Act litigation against Anthem regarding its reporting of risk adjustment data for the Medicare Advantage program, the government filed a motion to compel regarding several documents that Anthem withheld from production on the grounds of attorney-client privilege and work product. The Court ordered Anthem to produce certain non-privileged documents.
Background
Medicare Advantage Organizations (MAOs) such as Anthem contract with the government to pay for services to beneficiaries enrolled in Medicare Advantage in exchange for fixed payments based on the MAO’s reporting of diagnosis codes for the beneficiaries enrolled in their MA programs, also known as “risk adjustment reporting.” The government requires MAOs to ensure that their risk adjustment data is accurate.
In this case, the government alleged that Anthem retained a consultant to conduct “retrospective chart reviews” of charts obtained from providers to identify any conditions that had not been reported in Anthem’s risk adjustment data so that the data could be supplemented with the additional diagnosis codes. The chart review did not result in any codes being removed from the reported data, and thus, the government alleged that this “additive only” process fraudulently increased Anthem’s MA reimbursement by millions of dollars.
Anthem’s Involvement in Qui Tam Litigation and Response to Developments in the Medicare Advantage Program
Between 2014 and 2017, Anthem’s MA program was the subject of several qui tam lawsuits and a Civil Investigative Demand (CID) from the U.S. Department of Justice. Additionally, the company was prepared to respond to several regulatory changes in the MA program. Anthem’s internal Legal Department, as well as two outside law firms, were heavily involved in all of these matters.
Anthem alleged that approximately 70 documents generated during this period of time were prepared at the direction of counsel.
The Court’s Analysis of The Government’s Motion to Compel
After reciting the familiar principles regarding attorney-client and work product privileges, the Court addressed three overarching issues in its analysis of the government’s motion to compel, and appended a detailed exhibit to its opinion, detailing how these issues applied to the specific documents at issue. (The government offered a fourth argument regarding redactions but the Court’s response seemed to be susbsumed in the other overarching issues).
1. Operational Documents
The Court agreed with the government that documents or portions of documents reflecting purely operational content are not privileged and ordered the production of such documents. The documents the court ordered Anthem to produce, containing operational content, included a “Weekly Revenue Update,” an email chain regarding expanded chart review, an email chain that included no attorneys, and documents reflecting comments from non-attorneys on the government’s proposed MA regulations.
2. Consulting Work by MMC
The second category of documents sought by the government related to work by MMC, a consultant hired by Anthem’s Legal Department to investigate a flaw in Anthem’s risk adjustment data submission system. While the court found that documents reflecting MMC’s work were privileged, it declined to extend the privilege over purely operational or business aspects, noting that business or operational advice by in-house counsel is typically not privileged.
3. Routine Audits
The government argued that documents related to routine audits should be produced as they were conducted for non-legal purposes. Anthem responded that these audits were related to obtaining legal advice and are thus privileged. The Court, without further specificity, found that to the extent such audits were prepared by counsel or reflected legal advice, and otherwise met the elements of the privilege, they should not be produced.
US v. ANTHEM, INC., 2025 WL 2426482 (U.S.D.C., S.D.N.Y., 8/22/2025)