Hospitals

When hospitals submit false claims to Medicare and Medicaid, they jeopardize those programs. When they do so knowingly, they violate the False Claims Act. Hospitals typically face whistleblower lawsuits and False Claims Act liability when they cause losses to federal health programs by knowingly:

  • Submitting claims for services never rendered
  • Submitting claims for medically unnecessary services
  • Billing outpatient visits as inpatient admissions
  • Upcoding (billing under the wrong CPT/billing code in order to increase reimbursement)
  • Billing for brand name drugs when generics are dispensed
  • Charging for physician services without records of physician presence or involvement
  • Entering into improper financial relationships with physicians, including paying physicians kickbacks to admit or refer patients

Case Examples

A number of successful False Claims Act cases have been brought against hospitals. By way of example:

In 2014, Halifax Hospital Medical Center in Florida agreed to pay $85 million to resolve claims that it violated the False Claims Act by entering into contracts with oncologists that gave the oncologists incentive bonuses based on the value of prescription drugs and tests they ordered and Halifax billed to Medicare. The settlement stemmed from a whistleblower complaint filed by a hospital employee. Read more

Also in 2014, Saint Joseph Health System in Kentucky agreed to pay $16.5 million to settle whistleblower claims that the hospital violated the False Claims Act by submitting claims to Medicare and Medicaid for a variety of unnecessary cardiac procedures. The whistleblowers in this case were three cardiologists. Read more.

In 2013, fifty-five hospitals in twenty-one states agreed to pay a total of $34 million to settle whistleblower claims that they violated the False Claims Act by submitting claims to Medicare for kyphoplasty procedures (used to treat compression fractures in the spine), which they improperly billed on an inpatient rather than outpatient basis, in order to increase their reimbursement. The two whistleblowers in these cases were a former reimbursement manager and a former regional sales manager for Kyphon, Inc., which counseled hospital providers to perform kyphoplasty procedures as inpatient rather than outpatient procedures to increase billings. They received $5.5 million as their share of the settlements. Read more.

In 2013, Tenet Healthcare agreed to pay $4 million to resolve claims that it violated the False Claims Act by providing leased space to doctors at below market value, as an inducement to the doctors to refer and admit patients to the hospital. Ten years before, in 2003, Tenet agreed to pay $54 million to resolve claims that a Tenet facility had violated the False Claims Act by performing unnecessary cardiac procedures that were billed to Medicare, Medicaid, and TriCare. Read more

In 2009, the University of Chicago Medical Center (UCMC) agreed to pay $7 million to settle qui tam, whistleblower-led claims, prosecuted together with the Illinois Attorney General’s office, that, from at least 1997 through 2005, UCMC violated the Illinois False Claims Act by illegally “double-bunking” newborn infants in its neonatal intensive care unit, placing two babies in beds designed and designated for one, forcing the infants to share “set-ups,” which include oxygen and other beside supplies, and then seeking payment from Medicaid for that egregious practice. The whistleblowers in this case were two longtime nurses in UCMC’s neonatal intensive care unit. They received $1.9 million as their share of the settlement, one of the highest percentage awards ever provided to whistleblowers under the Illinois qui tam statute.

In 2008, St. Joseph’s Hospital of Atlanta agreed to pay $26 million to settle whistleblower claims that it violated the False Claims Act by overcharging Medicare by billing outpatient visits as inpatient admissions. The whistleblower was a former hospital employee.

In 2005, the Chattanooga-Hamilton County Hospital Authority agreed to pay $40 million to resolve claims that it had entered into a series of kickback arrangements with physician groups to induce physicians in those groups to refer patients to its facilities. Read more.

If you have knowledge and solid evidence of fraud or false claims by a hospital or another health care provider, please contact our Chicago whistleblower lawyers.
Consultations are free and confidential.