| Course | HCR 264 Regulatory Essentials of Compliance Program Design |
|---|---|
| Module | Module 3 |
| Paper type | Case analysis paper |
| Length | About 688 words, 5 pages |
| Format | APA 7 student paper |
| School | Arizona State University |
| Program | BS in Health Care Compliance and Regulations |
| Updated | October 2026 |
Free sample paper for HCR 264 Module 3
Looking Only One Way: Independence Blue Cross and the Compliance Risk of One-Sided Chart Reviews
Student Name
BS in Health Care Compliance and Regulations, Arizona State University
HCR 264: Regulatory Essentials of Compliance Program Design
Instructor Name
Month Day, Year
Looking Only One Way: Independence Blue Cross and the Compliance Risk of One-Sided Chart Reviews
The Case
On September 30, 2026, the Justice Department announced that Independence Blue Cross (IBX) agreed to pay $22.5 million to resolve allegations that it violated the False Claims Act in its Medicare Advantage business (U.S. Department of Justice, 2026). The case began as a whistleblower suit filed by a former IBX employee, who will receive $3,825,000 of the settlement. As in every civil settlement of this kind, the claims are allegations, and there has been no determination of liability.
The Problem
Medicare pays Medicare Advantage organizations a monthly amount for each enrollee, raised when an enrollee's coded conditions signal that care will cost more. The diagnoses therefore drive the payment. According to the government, for payment years 2017 through 2021 IBX ran a chart review program in which nurse reviewers read enrollees' medical records and listed every condition the records supported. IBX used those results to submit additional diagnosis codes and obtain more money. The same reviews sometimes found that codes IBX had already submitted were not supported by the record, but IBX did not delete those codes, which would have required repaying Medicare (U.S. Department of Justice, 2026). The government described this as using the reviews to find payments owed to the plan while ignoring them when they showed the plan had been overpaid.
The Legal Framework
Three rules make this conduct a compliance problem. First, under 31 U.S.C. § 3729(a)(1)(G), the reverse false claim provision, a party that knowingly holds on to money it should have returned to Medicare is liable as if it had filed a false claim. Second, Medicare Advantage organizations must report and return overpayments they identify, under the overpayment rule for Part C (42 C.F.R. § 422.326). Third, plans certify the accuracy of the risk adjustment data they submit, and the government alleged that IBX's certifications were false. A plan that knows a code is unsupported, through its own chart review, can hardly claim it did not know.
Why the Risk Is Industry-Wide
The IBX case is not unusual. Chart reviews and in-home health risk assessments are tools Medicare Advantage plans use to find diagnoses that traditional Medicare never records, and one analysis of encounter data estimated that the two tools raised enrollees' risk scores by 7.4% in 2021 (Jacobs, 2024). OIG has warned about the same pattern, finding that some plans drew a large share of their risk-adjusted payments from diagnoses reported only on chart reviews and home visits (Office of Inspector General [OIG], 2021). One-sided reviews, which only ever add codes, are the obvious risk.
Compliance Failures
Read against OIG's seven elements, the allegations point to failures in at least three. Auditing and monitoring failed, because the reviews generated evidence of overpayments that no process acted on. Response to detected problems failed, because the overpayments were not reported or returned. And policies failed, or were missing, because a chart review program should have a written rule that results are used in both directions. The whistleblower's role also raises a question about internal reporting: whether the employee's concerns reached the compliance officer, and what happened if they did.
Recommended Controls
Taken together, these controls make the plan's chart reviews symmetrical: whatever the record shows, up or down, reaches Medicare.
| Control | What it does |
|---|---|
| Two-way review policy | Requires every chart review result, adds and deletes, to be submitted |
| Deletion tracking | Compliance monitors the ratio of deleted to added codes by vendor and reviewer |
| Overpayment workflow | Routes any unsupported code to a 60-day investigate-and-repay process |
| Independent audit | An outside reviewer samples chart reviews each year |
| Hotline follow-up | Every coding concern is logged, investigated and closed with a written finding |
Conclusion
The IBX settlement shows that the risk in risk adjustment is not only adding codes that should not be there but keeping codes the plan knows are wrong. A compliance program that audits in only one direction is not auditing. For any organization that reviews its own records for payment, the lesson is to treat every finding the same way, whether it raises revenue or lowers it.
References
False Claims Act, 31 U.S.C. § 3729 (2024).
Jacobs, P. D. (2024). In-home health risk assessments and chart reviews contribute to coding intensity in Medicare Advantage. Health Affairs, 43(7), 942-949. https://doi.org/10.1377/hlthaff.2023.01530
Office of Inspector General. (2021). Some Medicare Advantage companies leveraged chart reviews and health risk assessments to disproportionately drive payments (OEI-03-17-00474). U.S. Department of Health and Human Services. https://oig.hhs.gov/oei/reports/OEI-03-17-00474.asp
Overpayments, 42 C.F.R. § 422.326 (2025).
U.S. Department of Justice. (2026, September 30). Independence Blue Cross to pay $22.5M to resolve False Claims Act allegations [Press release]. https://www.justice.gov/opa/pr/independence-blue-cross-pay-225m-resolve-false-claims-act-allegations
Reading the HCR 264 Module 3 assignment instructions
Writing Assignment 2 in HCR 264 is the Problem Solving Paper, due in Week 3 after the modules on fraud, abuse and the government agencies that enforce them. The syllabus asks for a three-page APA paper analyzing a current or recent OIG case. OIG's Enforcement Actions page lists new criminal and civil cases every week, with links to the Justice Department press releases that carry the details, so a fresh case is never hard to locate. Choose one with enough public detail to analyze: what the organization allegedly did, which law it implicates and how the case was resolved. The word problem in the title is a clue. The paper should identify what went wrong in compliance terms and propose how an organization could prevent the same thing, not only retell the press release. It is one of four papers sharing the course's 300 writing points.
How the HCR 264 Module 3 example is put together
The sample opens with the case facts in one short paragraph, including the settlement amount, the whistleblower and the reminder that the claims are allegations. A problem section then explains, in plain words, how risk adjustment works and what the plan allegedly did with its chart reviews. The legal section names three rules with exact citations. A short section uses an OIG report and a peer-reviewed study to show the risk is industry-wide rather than unique to one insurer. The compliance failures are mapped to three of OIG's seven elements, which ties the case back to the course, and a table of five controls answers each failure. The conclusion states the lesson in two sentences.
Where the marks sit in the HCR 264 Module 3 rubric
Its share of the course's 300 writing points is awarded through a Canvas rubric. Readers reward an accurate account of a case that is actually current or recent, a clear explanation of the laws involved, an analysis of what failed inside the organization, recommendations that would have prevented or caught the problem and clean APA in three pages. Points drop when the paper is a summary of the press release, when it treats allegations as proven facts, when the law is named without explaining how the conduct violates it and when recommendations are generic, such as "more training." Strong papers also connect the case to the course's framework, such as the seven elements, because the course is about designing compliance programs and the case is a chance to show how design choices matter.
HCR 264 Module 3 help: mistakes that cost marks
Start at OIG's Enforcement Actions page and read the linked Justice Department release in full, since the OIG summary is a single sentence. Write the facts in your own words before you analyze them. Always say "alleged" for settled civil cases. Look up the statute or regulation itself rather than relying on the press release's summary. Map the failure to the seven elements, then propose a control for each failure. A table keeps a three-page paper within length. If the case you like has too little public detail, the desk can help you find one with more.
Write yours, or have the desk draft it
This paper is an original model document written by our desk, not a submitted student paper and not an official Arizona State University document. Read it for the moves, then write your own to the instructions in your classroom. If you want one built to your exact prompt and rubric, the first custom sample is free and arrives in 24 to 48 hours.
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HCR 264 Module 3 questions, answered
Where can I find a free HCR 264 Module 3 sample paper?
The complete problem solving paper is above, analyzing the 2026 Independence Blue Cross Medicare Advantage settlement.
Where do I find a current OIG case for HCR 264?
OIG's Enforcement Actions page lists new cases weekly, each linked to a Justice Department or U.S. Attorney press release with the details.
What is a reverse false claim?
Knowingly keeping money owed back to the government, such as an identified overpayment, which the False Claims Act treats like submitting a false claim.
Why are chart reviews a compliance risk in Medicare Advantage?
Diagnoses raise payments, so reviews that only add codes, and never delete unsupported ones, can inflate what Medicare pays.
Should a case paper call settled allegations violations?
No. Civil settlements usually resolve allegations without a finding of liability, so say "alleged" throughout.