To: Board of Supervisors
From: Dr. Grant Colfax, Health Services Director
Report Title: Payments for Services Provided by Cotiviti, Inc.
☒Recommendation of the County Administrator ☐ Recommendation of Board Committee
RECOMMENDATIONS:
APPROVE and AUTHORIZE the Auditor-Controller, or designee, to pay $147,900 to Cotiviti, Inc., a corporation, for consulting and technical services provided to the Contra Costa Health Plan (CCHP) for analyzing Healthcare Effectiveness Data and Information Sets (HEDIS) for fraud, waste and abuse prevention for the months of June 1, 2025 through October 31, 2025, as recommended by the Health Services Director.
FISCAL IMPACT:
Approval of this payment will result in a one-time expenditure of up to $147,900 and will be funded 100% by CCHP Enterprise Fund II revenues.
BACKGROUND:
This Contract meets the needs of the County’s population by providing data analysis software for HEDIS projects and reports to support State and contractual requirements for CCHP. Cotiviti, Inc. provides its licensed program, Quality Intelligence, used by CCHP to calculate and analyze HEDIS measures. CCHP began contracting for these services with this vendor in November 2009. HEDIS Measures & National Committee for Quality Assurance (NCQA) Accreditation certification is a requirement of the Department of Health Care Services (DHCS), for which CCHP is assessed. HEDIS is required for NCQA Accreditation and DHCS compliance. HEDIS scores are used to determine Plan assignment, and therefore impact capitation payments from the state. HEDIS will further be used for Quality Rate Factor payments in which capitation is not only based on monthly membership numbers but also HEDIS scores in comparison to other Plans. HEDIS is a heavily structured, highly audited process and calculations will not be accepted without the use of NCQA certified software to process the data. Under this Contract, Cotiviti also provides the NCQA software to process the data.
Fraud, Waste, and Abuse
CCHP is contractually and legally required to implement and maintain administrative and management arrangements or procedures, as well as a mandatory compliance plan, which are designed to guard against fraud and abuse. Among other things, CCHP is required to implement and maintain procedures that are designed to detect and prevent Fraud, Waste, and Abuse (FWA). Failure to meet these requirements would result in a breach of contract and a violation of the Knox Keene Act. Cotiviti serves the essential purpose of detecting and preventing FWA by analyzing claims information. They have the methodologies and procedures in place to take otherwise convoluted claims information and crosswalk it so that CCHP can make appropriate comparisons and sound conclusions regarding the presence of FWA. Failure to contract with a vendor for this purpose would mean that CCHP is no longer in compliance with the respective provisions.
On November 1, 2022, the Board of Supervisors approved Contract #27-791-11 with Cotiviti, Inc., in an amount not to exceed $3,000,000, to provide a hosted solution for software services related HEDIS measures, data analysis related to FWA prevention and member outreach services for the period November 1, 2022 through October 31, 2025.
The Division signed a work order for additional services concerning FWA prevention, however the Contract was not amended to add these services. To meet County’s service needs, Cotiviti provided these services in good faith, which exceeded the payment limit of the contract by $147,900. Cotiviti submitted invoices beginning June 2025 through October 2025 for the additional services requested by County.
The Contractor is entitled to payment for the reasonable value of its services under the equitable relief theory of quantum meruit. That theory provides that where a Contractor has been asked to provide services without a valid contract, and the Contractor does so to the benefit of the County, the Contractor is entitled to recover the reasonable value of those services. The Contractor has provided services at the request of the County that exceeds the terms of the Contract. The Department cannot pay Contractor for services rendered that exceed the term of the Contract. As such, the Department recommends that the Board authorize the Auditor-Controller to issue a one-time payment not to exceed $147,900 to Cotiviti, Inc.
CONSEQUENCE OF NEGATIVE ACTION:
If this payment is not approved, the Contractor will not be paid for services provided to County by Contractor in good faith. This could lead to a disruption or cancelation in services which could negatively affect compliance, state funding and consequentially have a detrimental effect on patient care.