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Hospital Fraud

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December 21, 2018

The United States has partially intervened in a False Claims Act case initiated by a whistleblower against Wheeling Hospital Inc. along with Wheeling's management consultant R & V Associates Ltd., and Wheeling's CEO, Ronald Violi.  The defendants are alleged to have violated the Stark Law and Anti-Kickback Statute including through its payments to physicians based on referrals by those physicians and/or in excess of fair market value.  The whistleblower, Louis Longo, was previously Wheeling's executive vice president.  DOJ

December 18, 2018

Following an earlier settlement of federal claims, Florida has announced that hospital chain Health Management Associates, LLC, will pay $5.5 million to Florida to resolve claims that two HMA hospitals, Charlotte Regional Medical Center and Peace River Medical Center, billed the Florida Medicaid program for services referred by physicians to whom HMA provided remuneration in return for patient referrals.  The unlawful remuneration took the form of free rent, office space, and staff services, as well as direct payments purportedly meant to cover overhead and administrative costs.  FL AG

Catch of the Week — PA Hospital and Health System Pays $12.5 Million to Settle FCA Allegations

Posted  12/14/18
Doctor discussing knee injury with patient seated on exam table
Coordinated Health Holding Company, LLC, a for-profit hospital and health system, and its founder, owner, and CEO, Emil DiIorio, M.D., have agreed to pay a combined $12.5 million to settle allegations of violating the False Claims Act for submitting false claims to Medicare and other federal health care programs for orthopedic surgeries. Coordinated Health is a for-profit hospital and health system based in the Lehigh...

October 9, 2018

The former CFO and COO of Houston-area Atrium Medical Center and Pristine Healthcare, Starsky Bomer, has been convicted for his role in a $16 million Medicare kickback scheme.  Bomer and others paid illegal kickbacks to group home owners and patient recruiters in exchange for the referral of Medicare patients for outpatient mental health treatment through the hospitals' partial hospitalization program (PHP).  While the hospitals billed Medicare $16 million for these patients, the evidence at trial demonstrated that Bomer knew that PHP services were not necessary for most of the patients, and that the patients were not, in fact, provided with such services.   DOJ

September 28, 2018

Kalispell Regional Healthcare System and six of its related entities agreed to pay $24 million to settle a False Claims Act case based on its compensation arrangements with physicians, which were alleged to violate the Stark Law, and other arrangements alleged to violate the Anti-Kickback Statute.  Between 2010 and 2018, KRH entities reportedly paid excessive and above-market full-time compensation to more than 60 physicians, even if those physicians worked far less than full-time.  In addition, some of the KRH entities were alleged to unlawfully seek referrals from physicians through excessive compensation arrangements and the provision of administrative services at below market rates.  Jon Mohatt, the former CFO of a related entity, initiated the action with a qui tam filing; Mohatt will receive $5.4 million dollars as a relator's share of the government's recovery.  DOJ

Catch of the Week — Health Management Associates

Posted  09/27/18
Health Management Associates, LLC (“HMA”), a former hospital chain now part of Community Health Systems, agreed on September 25th to a $260 million settlement to resolve allegations of false billing and kickbacks alleged in eight qui tam cases under the False Claims Act (“FCA”). HMA was a hospital chain headquartered in Tampa, Florida that was acquired by Community Health Systems Inc., a major U.S. hospital...

September 26, 2018

Health Management Associates, LLC (HMA)—now part of Community Health Systems Inc. (CHS)—has agreed to pay a combined $260 million to settle civil and criminal charges of defrauding Medicare, Medicaid, and TRICARE and violating the Anti-Kickback Statute, the Stark Law, and False Claims Act. The alleged fraud was revealed by eight whistleblowers and involved paying kickbacks to doctors for patient referrals, pressuring doctors to meet emergency patient admission quotas, billing outpatient or observational services as inpatient services, and inflating the cost of emergency services. The eight whistleblowers have been granted a combined $27 million award so far. DOJ; USAO EDPA; USAO SDFL; USAO WDNC

September 25, 2018

Virginia Commonwealth University Health System Authority, which operates a hospital and related facilities in Richmond, Virginia, agreed to pay $4 million to resolve claims that it overbilled government healthcare programs for radiation oncology services from 2009 through 2014.  The settlement follows VCU's voluntary disclosure of the overbilling after an audit of patient files and billing data.    E.D. Va. USAO

Inman writes on whistleblower case brought by outsider

Posted  08/30/18
Constantine Cannon partner Mary Inman published an article in RAC Monitor about a lawsuit brought against Providence Health & Services and its consultant J.A. Thomas and Associates LLC (JATA) by Integra Med Analytics LLC, a data analysis firm that uses statistical analysis of publicly available data to attempt to uncover and prove fraud. Integra alleged that it analyzed seven years’ worth of publicly-available...
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