Unnecessary inpatient admissions results in government intervention in False Claims Act lawsuit

posted on:
June 7, 2016

author:
Larry Golston

category:
Fraud

Late last month, the Department of Justice (DOJ) announced that the United States has decided to intervene in a False Claims Act (FCA) lawsuit against Prime Healthcare Services Inc. (Prime). The United States alleges that Prime improperly admitted patients into its hospitals, resulting in false claims being submitted to Medicare.

Prime allegedly pressured its Emergency Department physicians and administrators to raise inpatient admissions. This pressure forced doctors to admit patients when admission was not medically necessary.

When a person visits the emergency room, the doctor has options on how to treat them. The doctor could treat the patient as an outpatient, place the patient in observation, discharge the patient, or admit the patient. When corporations such as Prime place undue pressure on doctors to raise admission rates, doctors are forced to admit patients even if admission was not medically necessary. Under the DOJ’s theory, because these admissions were medically unnecessary, Prime submitted false claims to federal health care programs like Medicare.

When hospitals conduct practices such as these, they not only contribute to the rising cost of health care, but they also put the patient in risk. U.S. Attorney Eileen M. Decker for the Central District of California stated, “Fraudulent billing practices, such as those alleged in this civil lawsuit, harm taxpayers who fund health care programs, such as Medicare.”

As Medicare is forced to pay claims for unnecessary medical treatment, the cost of that medical treatment rises as the pool of taxpayer funds is diminished. It then falls upon the taxpayer to replenish the pool.

The Government works vigorously in its war against fraud. One of the most powerful weapons in its arsenal is the FCA, which empowers private citizens to report fraud committed against the Government. The ordinary individual becomes extraordinary as they come to be a whistleblower and file suit on behalf of the United States. The FCA permits the Government to intervene in these qui tam cases, which it has done in this case.

As a reward for doing the right thing, the whistleblower is entitled to 15 to 30 percent of whatever the government recovers for their part in the case. The DOJ has recovered more than $29 billion through the FCA since January 2009. Of that $29 billion, more than $17.5 billion was recovered in cases concerning fraud against federal health care programs.

Are you aware of fraud being committed against the federal Government, or a state Government? If so, the FCA can protect and reward you for doing the right thing by reporting the fraud. If you have any questions about whether you qualify as a whistleblower, please contact an attorney at Beasley Allen for a free and confidential evaluation of your claim. There is a contact form on this website, or you may email one of the lawyers on our whistleblower litigation team: Archie Grubb, Larry Golston, Lance Gould or Andrew Brashier.

Source: U.S. Department of Justice

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