Staten Island University Hospital will pay the United States government more than $74 million to settle claims that the hospital defrauded Medicare, Medicaid and the military's health insurance program, TRICARE.
In announcing the $74,032,565 settlement, the U.S. Department of Justice said the hospital will also pay the State of New York $14,883,883, for damages to the state's Medicaid Program. In total, SIUH will pay $88,916,448.
"Those who defraud and jeopardize the nation's vital, federally-funded health care programs will be aggressively investigated and held to account," said Benton J. Campbell, U.S. Attorney for the Eastern District of New York. "Only by ensuring that the billing and cost guidelines of Medicare and Medicaid are scrupulously followed can we have confidence that affordable healthcare will continue to be available for those in need."
The settlement also resolves lawsuits filed by two individuals on behalf of the government in the United States District Court for the Eastern District of New York.
Miguel Tirado, a former SIUH director of chemical dependency services, filed suit under the federal False Claims Act and the New York State False Claims Act, alleging that the hospital had fraudulently billed Medicaid and Medicare for inpatient alcohol and substance abuse detoxification treatment.
Elizabeth M. Ryan, widow of an SIUH cancer patient, asserted in her federal False Claims Act suit that SIUH fraudulently billed Medicare for stereotactic body radiosurgery treatment that was provided on an outpatient basis to cancer patients.
The U.S. government's investigation found that, during the period July 1, 1994 through June 30, 2000, SIUH submitted claims for payment for detoxification treatment provided to patients in beds for which SIUH had received no certificate of operation from the New York State Office of Alcoholism and Substance Abuse Services.
Federal officials also discovered that from 1996 through 2004, SIUH defrauded Medicare and TRICARE by knowingly using incorrect billing codes for cancer treatment performed at the hospital. By using incorrect codes, SIUH obtained reimbursement for treatment that was not covered by Medicare or TRICARE.
According to reports, Tirado will receive $2.3 million from the federal government and $2.97 million from New York. Ryan will receive $3.75 million as her portion of the federal recovery. The federal False Claims Act and newly-enacted New York State False Claims Act permit private individuals to file suits on behalf of the government and receive a portion of the recovery.
"Settlements such as this demonstrate yet again that submitting fraudulent claims to Medicare and Medicaid artificially raises healthcare costs and in turn steals from those who depend on these government medical programs," said HHS Inspector General Daniel R. Levinson. "The Office of Inspector General, working with our federal and state law enforcement partners, will continue to aggressively investigate and prosecute such fraud."
SIUH has also agreed to enter into a Corporate Integrity Agreement with the HHS Office of Inspector General, under which the hospital will maintain a compliance program to help ensure against a recurrence of fraud.