Business
California hospital pays millions in fraud case
NEWS IN BRIEF — Posted Sept. 19, 2005
A California hospital has paid the federal government $8 million to settle claims that a consulting firm helped it fraudulently overbill federal health insurance programs.
The settlement involving Eisenhower Medical Center in Rancho Mirage, Calif., helps resolve allegations made in a 1998 whistle-blower lawsuit in which a former employee of the consulting firm Healthcare Financial Advisors claimed the firm helped its clients seek reimbursements for unallowable costs.
According to the lawsuit, HFA helped clients prepare two cost reports. One was inflated and submitted to Medicare; a second, more accurate one was done for internal use, prosecutors said. The alleged overbilling took place during the 1990s.
Former HFA employees, allegedly involved in these activities, were not expected to be prosecuted, according to press reports.
Eisenhower did not admit any wrongdoing under the settlement. The hospital said in a written statement that it was "pleased the matter was resolved appropriately."
U.S. Attorney Debra Wong Yang said other defendants in the lawsuit previously had reached settlements.
Note: This item originally appeared at http://www.ama-assn.org/amednews/2005/09/19/bibf0919.htm.
