Six hospitals in Indiana and Alabama have agreed to pay more than $8 million to settle allegations of Medicare fraud, according to the Department of Justice.
The Indiana hospitals – St. Francis Hospital in Beech Grove, Deaconess Hospital in Evansville and St. John’s Hospital System in Anderson – will pay $3,158,629, $2,110,034 and $826,256, respectively.
The Alabama hospitals - St. Vincent’s East Hospital and St. Vincent’s Birmingham Hospital, both located in Birmingham, and Providence Hospital in Mobile - will pay $1,459,395, $422,748 and $381,713, respectively.
“Hospitals that overcharge Medicare drain critical funds from the Medicare program and increase healthcare costs,” said Daniel R. Levinson, Inspector General for the U.S. Department of Health and Human Services. “This settlement demonstrates the federal government’s resolve to address this kind of fraudulent conduct.”
The government contends that, from 2002 to 2008, the six hospitals performed kyphoplasty, a minimally invasive procedure used to treat certain spinal fractures that often are due to osteoporosis, on an inpatient basis in order to increase their Medicare billings. The procedure can most often be performed safely as an outpatient surgery.
A lawsuit was filed in 2008 in federal district court in Buffalo, N.Y., by Craig Patrick and Charles Bates under the qui tam or whistleblower provision of the False Claims Act. Patrick, of Hudson, Wis., is a former reimbursement manager for Kyphon, and Bates is a former regional sales manager for Kyphon in Birmingham, Ala. They will receive approximately $1.4 million as their share of the settlement.
“The Department of Justice is committed to preventing waste, fraud, and abuse in the Medicare program and ensuring that Medicare funds are not expended for unnecessary services,” said Tony West, Assistant Attorney General for the Department’s Civil Division.