skip to Main Content

Athena Healthcare sued by Claims Audit Service for breach of contract

A costume was returned to federal court last Friday in Polk County, Iowa State Court by defendants led by Innovative Health Health Plan, LLC. ClaimDOC, LLC’s original complaint asserted civil claims for relief in the form of millions of dollars for fee payments required by a written agreement between plaintiff and defendant Athena Healthcare Associates.

The expelled defendants argue that the original complaint does not conclusively establish diversity jurisdiction and requested that the complaint proceed in the Southern District of Iowa.

According to the lawsuit filed in state court, ClaimDOC “provides claims auditing and member advocacy services designed to achieve lasting health benefits.” Defendant Athena is a “provider of for-profit, short-term, post-hospital skilled nursing rehabilitation facilities.” Athena employees and their dependents benefit from a self-insured plan governed by the Employees Retirement and Income Security Act (ERISA). In 2018, plaintiff accepted defendant Athena as a client to provide claims review services to plaintiff, per the state court document.

The agreement between the claimant and Athena specifies that the ClaimDOC fee will be paid by either Athena or the plan, and in the event the plan fails to make payment, Athena will provide coverage.

Defendant Allen Jackson owns and operates Defendants HP, IHIP and HIS. The complaint alleges that Allen Jackson “teamed up with Athena owner Lawrence Santilli in an effort to deny Athena beneficiaries more than $9 million in health care benefits and avert nearly 2 million dollars in contractual obligations to ClaimDOC”.

Plaintiff put Athena on notice of termination after failing to make timely payments and meet its contractual obligations. The complaint alleges that those involved in the alleged conspiracy continued to claim that Athena was financially sound despite the fact that she had not made medical payments to the plaintiff.

Eventually, the two parties reached an amended agreement that allowed the plaintiff to continue serving Athena, but they soon fell behind on payments and announced that they would transfer their services to defendant S&S Healthcare. Given that the transition would take place before the end of the plan year, plaintiff explains that it took additional steps to ensure that plan beneficiaries would be provided for and communicated with defendants regarding the lack of compliance of the plan. ‘Athena and funding shortfalls.

After the agreement was terminated, Athena still owed millions of dollars in medical claims and ClaimDOC fees. Plaintiff soon realized that Defendant Athena had become involved in a scheme with Defendants where they would continually submit claims to avoid payment, which enabled Athena to “[prioritize] payment to defendants helping it avoid payment of medical claims, and these defendants are accepting said funds at the expense of Athena’s beneficiaries.

The complaint cites breach of contract, interference with contract, fraud, unjust enrichment, and a preliminary and permanent injunction. Plaintiff ClaimDOC seeks an injunction compelling Defendant Athena to pay the claims in chronological order, court costs, court costs, and any other relief deemed just by the Court.

The plaintiff is represented by Nyemaster Goode, CP

Back To Top