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False Claims Act | SEC Whistleblower Claim

Sixteen Hospitals Violate False Claims Act to the Tune of $15.69 Million

According to the US Justice Department, 16 hospitals across the country will repay the federal government nearly $15.79 million for claims submitted to Medicare for services deemed unreasonable or unnecessary. This is one of the largest violations of the False Claims Act to date.

The Involved Hospitals

Health Management Associates Inc., or HMA, owns and operates 14 of the involved hospitals. They include Central Mississippi Medical Center, Crossgate River Oaks (Mississippi), Dallas Regional Medical Center (Texas), Davis Regional Medical Center (North Carolina), East Georgia Regional Medical Center, Gilmore Regional Medical Center (Mississippi), Lake Norman Regional Medical Center (North Carolina), Lehigh Regional Medical Center (Florida), Medical Center of Southeastern Oklahoma, Natchez Community Hospital (Mississippi), Santa Rosa Medical Center (Florida), Southwest Regional Medical Center (Arkansas), and Summit Medical Center (Arkansas). Between the 14 hospitals, a payment of $15 million will reimburse the federal Medicare program. Wesley Medical Center in Mississippi will pay $210,000, and North Texas Medical Center will round out the rest with a payment of $480,000.

The Allegations

Between the years of 2015 and 2013, the 16 above hospitals allegedly billed Medicare for Intensive Outpatient Psychotherapy, or IOP services, which are programs designed to treat individuals with serious mental disorders, that they knew were not billable. According to the claim, these hospitals billed Medicare for unqualified IOP services. According to current law, hospitals may only bill Medicare for services under certain conditions. In this case, the patients’ conditions did not qualify for IOP, staff failed to track patients’ progress properly, the patients did not receive the right level of treatment, or individualized treatment plans were not the first course of action as per Medicare’s guidelines.

The Impact on Consumers

With millions of dollars lost each year due to false and fraudulent claims like these, it is no wonder that the costs of healthcare continue to spiral out of control. Millions of people in the US rely on Medicare, a program for senior citizens and the disabled, to help them cover the enormous costs of healthcare. Due to false claims like these, the costs of healthcare are on the rise and Medicare covers less than ever before. Seniors and disabled persons who are already struggling to make ends meet must purchase expensive supplementary plans and pay exorbitant prices for many lifesaving prescription medications.

Whether the 16 hospitals above knew they were committing fraud when they submitted the claims remains unknown. However, one thing is certain: hospitals and medical centers like these need stricter guidelines for claims submissions. The Medicare program’s guidelines are indeed difficult to follow at times, but doing could save consumers tens of millions of dollars every year on the cost of insurance premiums alone.

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