United States v. United Healthcare Insurance Co.

ORDER

Judges Reinhardt and Nguyen have voted to deny appellees’ petition for rehearing en banc, and Judge Fisher has so recommended.

The full court has been advised of the petition for rehearing en banc and no judge has requested a vote on whether to rehear the matter en banc. See Fed. R. App. P. 35.

The petition for rehearing en banc is DENIED.

The opinion, filed August 10, 2016 and published at 832 F.3d 1084 , is AMENDED. An amended opinion is filed concurrently with this order.

Further petitions for rehearing may be filed.

OPINION

The Centers for Medicare <& Medicaid Services (CMS), administrator of the federal Medicare program, pays Medicare Advantage organizations fixed monthly amounts for each enrollee. CMS calculates the payment for each enrollee based on various “risk adjustment data,” such as an enrollee’s demographic profile and the en-rollee’s health status, as reflected in the medical diagnosis codes associated with healthcare the enrollee receives. These diagnosis codes (also known as encounter data) are reported by Medicare Advantage organizations to CMS. Because Medicare Advantage organizations have a financial incentive to exaggerate an enrollee’s health…