U.S. hospital service provider TeamHealth Holdings agreed to pay $60 million to settle charges its predecessor company IPC Healthcare Inc. violated the False Claims Act by billing Medicare, Medicaid, the Defense Health Agency and the Federal Employees Health Benefits Program for higher and more expensive levels of medical service than were actually performed. See DOJ Press Release.
According to the government, IPC encouraged false billings by its hospitalists, who are medical professionals whose primary focus is the medical care of hospitalized patients. Specifically, IPC allegedly encouraged its hospitalists to bill for a higher level of service than actually provided, a practice known as “up-coding.” In order to maximize its billings under this scheme, IPC allegedly pressured its hospitalists with lower billing levels to “catch up” to their peers.
In announcing the settlement, the government stressed its “ongoing commitment to ensure that health care providers appropriately bill government programs vital to patient health care,” and to hold accountable “[m]edical providers who fraudulently seek payments to which they are not entitled.” The allegations originated in a whistleblower lawsuit filed under the qui tam provisions of the False Claims Act by Dr. Bijan Oughatiyan, a physician formerly employed by IPC as a hospitalist. He will receive a whistleblower award of roughly $11.4 million from the proceeds of the government’s recovery.
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