Tenet Healthcare Asks Judge To Require Justice Department To Sue Individual Hospitals in Medicare Fraud Case
Attorneys for Tenet Healthcare, the nation's second-largest for-profit hospital chain, yesterday asked Los Angeles U.S. District Judge Gary Feess to exclude the company as a defendant in a Medicare fraud lawsuit filed by the Department of Justice, Bloomberg/Philadelphia Inquirer reports. Instead, attorneys argued that the DOJ should file suits against individual hospitals in the chain (Davis, Bloomberg/Philadelphia Inquirer, 6/11). The suit, filed in January by the DOJ, alleges that the Santa Barbara-based company collected an additional $115 million in revenue between 1992 and 1998 by falsifying diagnosis codes on Medicare claims in order to receive higher Medicare reimbursements, a process know as "upcoding." The lawsuit contends that Tenet told its hospitals to upgrade certain cases -- particularly pneumonia, septicemia and respiratory system diagnoses -- to "more severe diagnostic codes" to "maximize revenue." The DOJ seeks as much as $537 million from Tenet, including triple damages and civil penalties of between $5,000 and $10,000 for each of the alleged 19,300 cases (California Healthline, 1/10). Nicola Hanna, an attorney for Tenet, said, "What the government has to do is a statistical analysis for each hospital. What they've done instead is a global sample." However, DOJ attorney Diana Younts said the federal government "intends to prove that Tenet's management was responsible for the false claims," Bloomberg/Inquirer reports. Feess did not issue a judgment on Tenet's motion to dismiss the corporation as a defendant but said he would allow the DOJ to amend its complaint before issuing a ruling (Bloomberg/Philadelphia Inquirer, 6/11). The company also faces a separate DOJ investigation into billing practices related to Medicare outlier payments and to allegations that two doctors at a Tenet hospital in Redding performed unnecessary surgeries (California Healthline, 1/10).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.