Pinnacle Medical Solutions, LLC and Diabetes Management & Supplies, LLC have filed a verified complaint for declaratory and injunctive relief, compensatory damages, and attorneys’ fees against Louisiana Healthcare Connections (LHC), Centene Corporation, and Ralph L. Abraham in his official capacity as Secretary of the Louisiana Department of Health. The complaint was filed on May 31, 2024, in the United States District Court for the Middle District of Louisiana.
The plaintiffs allege that the defendants engaged in improper and unconstitutional attempts to claw back millions of dollars previously paid to Pinnacle and DMS for providing diabetes management devices and supplies to citizens of Louisiana. According to the plaintiffs, these actions violate the Federal Medicaid Act (42 U.S.C. § 1396a(a)(37)) and the Due Process Clause of the Fourteenth Amendment to the U.S. Constitution. The plaintiffs argue that LHC-Centene's audit findings were based on flawed methodologies and lacked proper oversight from LDH.
Pinnacle Medical Solutions is a Delaware limited liability company with headquarters in Mississippi, while Diabetes Management & Supplies is a Louisiana limited liability company headquartered in Louisiana. Both companies are wholly-owned subsidiaries of AdaptHealth Corp., which provides medical equipment services across all 50 states. The plaintiffs contend that LHC-Centene's audit findings included an alleged overpayment demand amounting to $5,769,627.75 for Pinnacle and $2,747,549.37 for DMS.
The complaint details several issues with LHC-Centene’s audit process. It alleges that LHC-Centene used software tool-based predictions with minimal human intervention to deny claims improperly. Furthermore, it argues that LHC-Centene did not adhere to CMS guidelines or obtain prior approval from LDH before employing statistical sampling and extrapolation methods for overpayment determination.
Pinnacle's formal rebuttal submitted on November 14, 2023, highlighted that their sampled claims were medically necessary and properly payable according to Local Coverage Article A55426 requirements. However, LHC-Centene denied these claims citing vague reasons such as "Billed Service Not Supported by Legible Evidence" without providing specific patient-level denial rationales.
The plaintiffs are seeking declaratory relief stating that the defendants' actions were unlawful under federal law; injunctive relief preventing further recoupment efforts; compensatory damages covering all amounts improperly withheld or recouped; attorneys’ fees; costs associated with this action; and any other relief deemed appropriate by the court.
The case is presided over by Judge John W. deGravelles under Case ID: 3:24-cv-00430-JWD-EWD.