CHARTER: Settles Fraud Case With Justice Department

      Settling allegations that it overcharged Medicare and other federal programs, Charter Behavioral Health Systems LLC has agreed to pay the government $7 million, the Justice Department said Friday. While the company did not admit any liability, the government charged that Charter deliberately "engaged in fraudulently billing federal health care programs for services and falsely documenting inpatient and outpatient psychiatric services that were not needed." Charter, which has filed for Chapter 11 bankruptcy protection, was once the country's largest chain of private psychiatric facilities. The agreement also allows the government to seek an additional $8 million in compensatory damages for fraud as "administrative and unsecured claims in the bankruptcy court proceedings." In addition, the deal gives HCFA the power to audit Charter's FY 2000 claims to look for any potential overpayments (Sniffen, AP/Philadelphia Inquirer, 8/19).