Tech company assisting UnitedHealth in collecting billions settles fraud claims with Department of Justice

Semler Scientific has reached a settlement with the Department of Justice, agreeing to pay almost $30 million to address allegations of health care fraud linked to their peripheral artery disease test, QuantaFlo. This test had been utilized by UnitedHealth Group and other major Medicare Advantage insurers. Additionally, Semler revealed that a significant customer responsible for almost half of its revenue in the second quarter of 2025 is scaling back their use of QuantaFlo, with implementation changes starting in October. As a consequence, Semler projects a revenue decrease of 50% in the fourth quarter of 2025.

UnitedHealth had been a prominent user of QuantaFlo, incorporating the test into their clinics and home visit programs following a nationwide screening initiative in 2017. Aetna also applied QuantaFlo in patient testing through home health visit services like Signify and Matrix Medical Network, both owned by CVS Health. Despite these developments, Semler Scientific, UnitedHealth, CVS Health, and Matrix Medical Network have not provided comments in response to media queries.

An SEC filing disclosed that a whistleblower filed a false claims act suit against Semler in December 2016 in the Middle District of Florida, leading to the DOJ’s subsequent investigation. The accusations included the submission of false claims to Medicare from 2010 to 2024. As part of the settlement, Semler agreed to pay $29.75 million and be under the surveillance of the Office of Inspector General for five years.

QuantaFlo, approved by the FDA in 2015 with limited clinical examination, measures artery blood volume by analyzing reflected infrared light via sensors attached to a patient’s fingers and toes. It serves as a tool to assist healthcare providers in diagnosing peripheral artery disease (PAD) rather than as a standalone diagnostic device. The DOJ contended that Semler Scientific misled customers by suggesting that QuantaFlo was reimbursable utilizing certain codes affiliated with the ankle brachial index test for a comprehensive identification of artery disease. The DOJ argued that QuantaFlo did not meet the same criteria as the ankle brachial index test and therefore should not be reimbursed at the same rate.

While the settlement solely pertains to fee-for-service claims paid by Medicare, UnitedHealth and other insurers extensively applied the test to their Medicare Advantage beneficiaries. Due to the payment regulations under Medicare Advantage, insurance entities receive additional funds to accommodate the medical expenses of patients with severe illnesses. The diagnostic coding related to various chronic conditions undertaken by insurers has led to exaggerated reimbursement claims, which are anticipated to cost taxpayers around $50 billion in the current year according to the Medicare Payment Advisory Commission.

Semler Scientific worked closely with insurers, helping them bolster revenue by utilizing their user-friendly and highly sensitive test. The arrangement was lucrative for both parties, leading to a substantial surge in profits for the company between 2018 and late 2021. However, following the DOJ’s investigation and Medicare’s ensuing restriction on PAD reimbursements, Semler has transitioned into a bitcoin-centric entity, thereby altering its previous focus on the early detection of artery disease. The company is currently awaiting FDA approval to incorporate QuantaFlo in diagnosing cardiovascular ailments, a clearance that is not anticipated until mid-to-late 2026 at the earliest. Moreover, Semler is entangled in a legal battle with investors in the Northern District of California concerning the timing of disclosing the DOJ investigation.

As per an analysis conducted for STAT by the Lown Institute, UnitedHealth amassed over 1.3 million unspecified artery disease diagnoses between 2018 and 2021, resulting in around $4 billion in taxpayer funds directed towards valid and false PAD diagnoses during that period.