HCA Agrees To Pay Justice Department $631M To Settle Civil Claims
Officials at HCA, the nation's largest for-profit hospital chain, yesterday said that the company has reached an agreement with the Justice Department to pay $631 million to settle civil claims over alleged Medicare fraud, although attorneys for the eight former HCA employees who prompted the federal investigation may challenge the settlement, the Wall Street Journal reports (Martinez, Wall Street Journal, 12/19). Under the settlement, HCA also agreed to pay $17.5 million to resolve similar claims by state Medicaid officials (O'Harrow, Washington Post, 12/19). The investigation into HCA began as a result of eight whistleblower lawsuits filed against the company since 1993. The lawsuits allege that HCA overstated expense statements, charged for services ineligible for reimbursements and paid physicians to encourage referrals to HCA facilities (California Healthline, 12/18). "We are pleased to have successfully negotiated a settlement to the remaining two civil issues," Jack Bovender, HCA chair and CEO, said (AP/Boston Globe, 12/19). Senior Justice Department officials and a federal court judge must approve the settlement.
The "sizable group" of attorneys for the whistleblowers could "delay, or even derail," the settlement, the Journal reports. Under the federal False Claims Act, employees who report employer wrongdoing can receive as much as 30% of the amount recovered by the federal government. John Phillips, an attorney for one of the whistleblowers, said the federal government has not informed the former HCA employee the amount that they will receive from the settlement. "We may well be challenging this," he said (Wall Street Journal, 12/19). HCA in March agreed to pay the federal government $250 million to settle questions about Medicare cost reports submitted by the company and reached several other settlements in 2000 (Washington Post, 12/19). HCA has agreed to pay the federal government a total of more than $1.7 billion to settle civil and criminal claims, the largest amount secured by the government in a health care fraud case (California Healthline, 12/18).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.