Tuesday, September 21, 2010

El Centro Regional Medical Center Settles Qui Tam Medicare Fraud Suit By Paying U.S. $2.2 Million and Entering Into A Corporate Integrity Agreement

On September 20, 2010, the El Centro Regional Medical Center in Imperial County, California (near the Mexico border) agreed to pay the United States $2.2 million, plus interest, to settle allegations that it defrauded Medicare. El Centro is a nonprofit community based hospital owned by the city of El Centro. It was formed in 1956.

The United States has agreed to dismiss the lawsuit as a result of the settlement announced today. In addition, as a condition of continued participation in federal health care programs, the Office of Inspector General of the U.S. Department of Health and Human Services (OIG-HHS) has required El Centro Regional Medical Center to enter into a Corporate Integrity Agreement. The agreement subjects the hospital to strict policies and procedures to ensure future compliance with applicable statutes and regulations that govern the use of federal health care funds.

Smaller providers often do not get the opportunity to enter into Corporate Integrity Agreements but given the nonprofit status of this hospital and the fact that it has been around for 40 years, that probably made a difference. Smaller providers when faced with overpayments and fraud allegations, however, should work on creating their own compliance plans and present them to Medicare or Medi-Cal in order to show their commitment to following the rules and regulations.

The government alleges that the 165-bed acute care hospital fraudulently inflated its charges to Medicare patients to obtain larger reimbursements from the federal health care program. The settlement covers claims submitted by the hospital for short inpatient admissions, usually of one day or less, when the services should have been billed on an outpatient “observation” basis or as emergency room visits.

The allegations arise from a lawsuit that was brought under the qui tam, or whistleblower, provisions of the False Claims Act (FCA), which permit private citizens with knowledge of fraud against the government to bring an action on behalf of the United States and to share in any recovery. The whistleblower in this case, Pietro Ingrande, a former employee of El Centro Regional Medical Center, will receive $375,000 as his share of the recovery.

Attorney Commentary:  The qui tam lawsuit shows the importance of having an operative compliance plan where employees are encouraged to report to the provider first before reporting to outside agencies. Exit interviews are also important to the process so former employees report any alleged wrongdoing that can be investigated by the provider to avoid qui tam lawsuits.  I encourage providers to adopt the saying "there is no such thing as a bad fact, only something I do not know." If an employee believes there is improper billing -- even if unfounded -- it is better for the provider to know it and address it internally before there is outside reporting.

Posted by Tracy Green, Esq. Please email Ms. Green at tgreen@greenassoc.com or call her at 213-233-2260 to schedule a complimentary 30-minute consultation.  

Any questions or comments  should be directed to Tracy Green, a very experienced California health care fraud attorney and qui tam defense attorney who understands fraud and the Medi-Cal Medicare programs at tgreen@greenassoc.com.

The firm focuses its practice on the representation of licensed professionals, individuals and businesses in civil, business, administrative and criminal proceedings. They have a specialty in representing licensed health care providers and in health care fraud related matters in California and throughout the country.
Their website is: http://www.greenassoc.com/


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