Seven hospitals in Florida, Mississippi, Texas, South Carolina, North Carolina and Alabama have agreed to pay more than $6.3 million to settle allegations that submitted false claims to Medicare, according to the Department of Justice.
The settlements resolve federal charges that the hospitals overcharged Medicare between 2000 and 2008 for performing kyphoplasty, a minimally invasive procedure used to treat certain spinal fractures that often are due to osteoporosis. In many cases, the procedure can be performed safely as a less costly outpatient procedure, but investigators charged that the hospitals performed the procedure on an in-patient basis in order to increase their Medicare billings.
"Hospitals that participate in the Medicare program must bill for their services accurately and honestly," said Tony West, Assistant Attorney General for the Department's Civil Division. "The Department of Justice is committed to ensuring that Medicare funds are expended appropriately."
The hospitals charged, and their fines, are:
- Lakeland Regional Medical Center in Lakeland, Fla. ($1,660,134.49);
- The Healthcare Authority of Morgan County – City of Decatur dba Decatur General Hospital, in Decatur, Ala. ($537,892.88);
- St. Dominic-Jackson Memorial Hospital in Jackson, Miss. ($555,949.35);
- Seton Medical Center in Austin, Texas ($1,232,955.91);
- Greenville Memorial Hospital in Greenville, S.C. ($1,026,764.01);
- Presbyterian Orthopaedic Hospital in Charlotte, N.C.($637,872.57); and
- The Healthcare Authority of Lauderdale County and the City of Florence, Ala., dba the Coffee Health Group, formerly known as Eliza Coffee Memorial Hospital ($676,038.00).
The hospitals were named as defendants in a lawsuit filed under the False Claims Act in 2008 in federal district court in Buffalo, N.Y., by Craig Patrick and Charles Bates. The qui tam, or whistleblower, provisions of the Act permit private citizens to file lawsuits on behalf of the United States and share in any recovery. Patrick, of Hudson, Wis., is a former reimbursement manager for Kyphon, and Bates was formerly a regional sales manager for Kyphon in Birmingham, Ala. They will receive a total of approximately $1.1 million as their share of the settlement proceeds.
"Hospitals overcharging Medicare take critically needed resources necessary to provide quality care and drive up healthcare costs," said Daniel R. Levinson, inspector general for the U.S. Department of Health and Human Services. "When Medicare and taxpayers' dollars are threatened, OIG and its federal partners will hold perpetrators accountable.
This resolution is part of the government's emphasis on combating healthcare fraud and another step for the Healthcare Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced by Attorney General Eric Holder and HHS Secretary Kathleen Sebelius in May 2009.