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Dignity Healthcare to Pay $37 Million for Medicare Fraud

Dignity Healthcare Settles Medicare Fraud and False Claims Suit with $37 Million

medicare fraudThe fifth-largest hospital chain in the United States agreed on Thursday, October 30th, to pay $37 million to settle allegations through the Department of Justice that the company committed Medicare fraud and defrauded the US government.

The California-based healthcare provider operates 39 hospitals across the country. According to prosecutors, 13 of Dignity Healthcare’s hospitals knowingly overcharged the federal Medicare program and TRICARE for patients who underwent cardiovascular procedures, such as stents or pacemakers, procedures which could have been billed as outpatient procedures.

The Medicare fraud and false claims allegedly occurred between 2006 and 2012.

Additionally, between 2006 and 2010, Dignity Healthcare branches admitted patients for common ailments that are normally treated in less costly ways, in order to intentionally over-bill the Medicare program. Also, between 2000 and 2008, the hospitals billed minimally-invasive procedures as in-patient, despite the fact that the procedures are designed to be outpatient procedures.

“This settlement demonstrates this office’s commitment to protecting our federal health care programs,” said U.S. Attorney Melinda Haag. “We will continue to aggressively and appropriately pursue False Claims Act allegations of wrongdoing in the health care industry.”

“Charging the government for higher cost inpatient services that patients do not need wastes the country’s vital health care dollars,” said Acting Assistant Attorney General Joyce Branda. “This department will continue its work to stop abuses of the nation’s health care resources and to ensure patients receive the most appropriate care.”

“Hospitals that attempt to boost profits by admitting patients for expensive and unnecessary inpatient hospital stays will be held accountable,” said Health and Human Services investigator Ivan Negroni. “Both patients and taxpayers deserve to have medical decisions made solely on what is best for the patient based on medical necessity.”

The Medicare fraud settlement allows Dignity Healthcare to admit no wrongdoing.

“The billing disputes reflect widespread confusion in the health care industry on unclear federal standards for approving coverage of patient admissions,” the company said in a statement. “As a result, it is often challenging for physicians to ensure their documentation adequately reflects their decision making in order to comply with complex regulations when making their best medical judgments.”

Whistleblower Protections and Medicare Fraud Claims

Qui Tam” are the first words of a Latin clause referring to the plaintiff as “one who sues as much for the state as for himself or herself.”

It is a provision of the Federal Civil False Claims Act that allows a private citizen to file a suit, in the name of the U.S. Government, charging fraud by government contractors and other entities that receive or use government funds. Bolstered by amendments passed by Congress in 1986, the law has armed private citizens who have independent and direct knowledge of fraud, whether financial institution fraud or Medicare fraud, with a weapon to prosecute government contractors and others who are defrauding the Government.

Common whistleblower actions include:

  • Medicare fraud,
  • defense contractor fraud, and
  • other kinds of fraud against state or federal government

Qui tam lawsuits have been, and continue to be, a very effective and successful tool in combating government procurement and program fraud.

The Strom Law Firm Can Help Protect Medicare Fraud Whistleblowers with the False Claims Act

If you are personally aware of a fraud that has been committed by your current or former employer, a competitor or otherwise, from tax evasion to Medicare fraud, contact the Qui Tam attorneys at the Strom Law Firm today for a no cost consultation to discuss the facts of your case and whether filing a qui tam may be appropriate. We understand the complexity of the False Claims Act, and can help you with your case. We offer free, confidential consultations so contact us for help today. 803.252.4800



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