Cleveland Clinic-owned hospital system pays $ 21 million to settle false claims allegations

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Dive Brief: A hospital system owned by the Cleveland Clinic in Akron, Ohio, is paying the federal government $ 21.3 million to settle claims it illegally billed to the Medicare program. Akron’s general healthcare system reportedly overpaid physicians well above market value for referring physicians to the system, in violation of the Anti-Kickback Law and the Physician Self-Referral Law, then billed Medicare for the wrongly referred company, in violation of the false claims law, between August 2010 and March 2016. With an AGHS whistleblower, the Cleveland Clinic Foundation, which acquired the system at the end of 2015, voluntarily disclosed to the federal government its concerns about the indemnification agreements, which were passed by the previous management of AGHS, the Justice Department said on Friday. Dive overview:

The Anti-Recoil Law prohibits providers from paying or soliciting other parties to get them to refer patients covered by federal programs like Medicare, while the Physician Self-Referral Law, also known as of Stark Law, prohibits a hospital from charging for these services. Despite the laws and a host of other regulations resulting in a barrage of DOJ lawsuits and a thorn in the side of providers for decades, fraud is still rampant in healthcare.

Of the more than $ 3 billion recovered by the government in 2019 from fraud and misrepresentation, nearly 90% were in the health sector, according to data from the Department of Justice.

“Doctors need to make referrals and other medical decisions based on what’s best for patients, not to serve profit-generating business deals,” the special agent in charge of the inspector’s office said. HHS General Lamont Pugh in a statement on the AGHS Regulation.

The Cleveland Clinic made an agreement with AGHS in 2014, agreeing to pay $ 100 million for minority ownership of the system. The agreement gave the clinic the option to fully acquire AGHS after one year, which it exercised upon the expiration of that period in August 2015.

The settlement stems from a whistleblower lawsuit brought by former AGHS chief internal audit officer Beverly Brouse, who will receive part of the settlement, the DOJ said. The False Claims Act allows whistleblowers to share the proceeds of a lawsuit.

As fraud has increased in healthcare over the past decade, the Department of Justice reported 247 new cases for potential investigation in 2000, 427 in 2010 and 505 in 2019, the federal government has renewed its efforts to crack down on illegal schemes. This resulted in the formation of groups like the Medicare Fraud Strike Force in 2007 and the Opioid Fraud and Abuse Detection Unit in 2017, which in turn allowed the Department of Justice to recover huge sums of money in the form of injections, settlements and guilty verdicts.

Some of the biggest settlements run into the hundreds of millions and involve billions of misrepresentations.

In 2018, the Department of Justice billed over 600 people for falsely billing federal programs over $ 2 billion; last year, federal agencies billed nearly 350 people for submitting more than $ 6 billion in bogus claims. The latter case led to the creation of a rapid-reaction strike force to investigate fraud involving major suppliers in several geographies.

Other important settlements include Walgreens’ $ 270 million fine in 2019 to settle lawsuits accusing the pharmacy giant of overcharging Medicare and Medicaid for drug reimbursement; Hospital operator UHS’s $ 122 million settlement last summer finalized a fraudulent billing case with the DOJ after it was accused of fraudulently billing Medicare and Medicaid for services at its behavioral health facilities; and West Virginia’s oldest hospital, the non-profit Wheeling Hospital, agreed in September to pay $ 50 million to settle allegations that it systematically violated laws against physician kickbacks, inappropriate referrals and false invoicing.

EHR provider eClinicalWorks paid $ 155 million to settle False Claims Act allegations of misrepresenting software capabilities in 2017, while Florida-based EHR provider Greenway Health was fined $ 57.3 million in 2019 to address claims that the provider pressured users into submitting false claims to EHR incentives. Program.

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