A court-appointed special master is recommending a 14-year-old whistleblower lawsuit not be allowed to move forward after finding no evidence to support key allegations that UnitedHealth Group wrongly collected billions of dollars by gaming risk-adjustment payments in the Medicare Advantage program.

The case, which the Justice Department joined in 2017, alleged the Eden Prairie-based health care giant engaged in one-sided reviews of medical charts to find evidence supporting higher payments for the company, but didn't use the information to correct "unsupported" billing codes for which UnitedHealth Group also collected fees.

The case in the U.S. District Court for the Central District of California was originally filed in March 2011 under seal by Benjamin Poehling, a former director of finance who started working for UnitedHealth Group in Minnesota in 2004.

In a report issued Monday, the special master found the government lacked "any evidence" to support key elements of its case.

"The government needed to present evidence from which a jury could reasonably conclude that the diagnosis codes United submitted were invalid, i.e., that codes were not supported by the related medical record," wrote Special Master Suzanne Segal. "The complete failure of any evidence on this essential element must result in summary judgment for United."

A spokesperson for the Justice Department said the government is objecting to the special master's report and recommendation, which has not yet been adopted by the judge overseeing the case. Segal, a former federal magistrate judge in central California, was appointed as a special master in the Poehling litigation in 2020.

UnitedHealth Group said in a statement its business practices have always been transparent, lawful and approved by the federal agency that runs Medicare.

"After more than a decade of DOJ's wasteful and expensive challenge to our Medicare Advantage business, the special master concluded there was no evidence to support the DOJ's claims we were overpaid or that we did anything wrong," the company said.

The complaint alleges UnitedHealth Group violated the "reverse false claims" provision of the federal False Claims Act, which makes companies liable for knowingly concealing, or knowingly and improperly avoiding, an obligation to pay money to the federal government.

While the original complaint named 15 health care companies as defendants, the government in 2017 moved forward on claims against just UnitedHealth Group and a large Texas-based medical group called WellMed, which United acquired more than a decade ago.

A federal judge in 2018 narrowed the set of claims the government might pursue in the case. At the time, UnitedHealth Group pushed back against the Justice Department's arguments, saying if the company should have been performing "two-way looks" at medical charts, then the federal agency that runs Medicare had "negligently misrepresented" this requirement.

The case focuses on Medicare Advantage health plans, which are a privatized version of the original Medicare health insurance program.

These health plans make payments to doctors and hospitals when enrollees use services. But the federal government pays Medicare Advantage insurers a set per-member, per-month rate, regardless of usage. The flat payments can increase when insurers and doctors submit coding data showing patients have more costly health problems, even if actual usage does not increase.

The lawsuit alleged UnitedHealth reviewed medical charts and even paid bonuses to physicians to find evidence that might justify higher payments, but didn't use chart reviews to correct errant codes that boosted payments.

This argument, however, has been based on "speculative assumptions," Segal wrote, because the Justice Department has never shown that any coding by physicians was errant. Instead, the government assumes that doctor diagnosis codes are unsupported, she wrote, when they're not also documented in chart reviews by the company's coders.

"As United points out, coders conducting a blind retrospective chart review are not looking to confirm the validity of diagnosis codes submitted by doctors," Segal wrote. "Undisputed testimony confirmed that coders may themselves miss diagnosis codes supported by a medical record for any number of reasons."

She also wrote: "This litigation has been pending for more than a decade, and the government has had ample opportunity to develop evidence in support of its theories. It has not done so."