The Villages (Fla.) Health, a primary and specialty care provider group, has agreed to pay $541.5 million to resolve allegations that it violated the False Claims Act by submitting improper Medicare Advantage diagnosis codes, according to an Aug. 26 news release from the Justice Department.
TVH, which sought Chapter 11 bankruptcy protection in July 2025 over the matter, was acquired by Humana’s CenterWell in September. The deal brought the organization’s eight primary care centers and two specialty care centers under the insurer, serving more than 55,000 patients.
Prosecutors said that from January 2020 through December 2024, TVA knowingly submitted improper diagnosis codes to MA insurers, which included UnitedHealthcare, Humana and GuideWell (parent company of Florida Blue), thereby inflating capitated payments that CMS made to the insurers, the Justice Department said.
The U.S. contended in the settlement agreement that “TVH violated the False Claims Act by knowingly submitting improper diagnoses to [Medicare Advantage Organizations] for, according to TVH’s estimates, $361 million in inflated payments of federal funds from the MAOs or knowingly causing the MAOs to submit false claims to Medicare Part C resulting in, according to TVH’s estimates, $416 million in inflated payments from CMS to the MAOs.” The two financial figures came from an outside consultant that The Villages Health retained.
TVH used two internal practices, “Retrospective Amendments” and “Sprints,” to insert additional diagnosis codes to patient medical records, which occurred months to over a year after a patient’s visit in some cases and were not initiated by the provider, the settlement agreement said.
TVA instead routed proposed amendments to the provider for approval or, if the provider had left the practice, a non-rendering provider such as the company’s chief medical officer or a medical director, would review.
In December 2024, TVH self-disclosed the conduct to the HHS Office of Inspector General. The organization also sent a letter to patients on Dec. 30, 2024, that said TVH “implemented certain billing processes and practices that were not consistent with Medicare payment policies. This resulted in TVH receiving more money from the Medicare program than if billed correctly.”
The settlement, which was approved by a bankruptcy court Aug. 25, also contained a sample review that found the share of unsupported diagnosis codes climbed each year, from 28.6% of codes reviewed in 2020 to 50.7% in 2024.
“In November of 2025, CenterWell completed the acquisition of substantially all of the assets of The Villages Health following the conclusion of a competitive auction process under the supervision of the United States Bankruptcy Court,” a spokesperson for Humana and CenterWell said in an Aug. 27 statement shared with Becker’s. “The Villages Health is now a part of CenterWell Senior Primary Care and all operations are conducted in compliance with all applicable laws and regulations. The allegations outlined in the DOJ settlement predate CenterWell’s acquisition of The Villages Health and the settlement is funded by the TVH estate, not Humana or Centerwell, as ordered by the TVH bankruptcy proceedings.”
