New Jersey Hospital Settles Medicare Fraud Allegations for $3M
November 19, 2009
Trinitas Regional Medical Center in Elizabeth, N.J., has agreed to pay the United States $3.02 million to settle allegations that it defrauded Medicare, according to a U.S. Department of Justice news release.
The United States is also seeking to intervene in a lawsuit brought against Brookhaven Memorial Hospital in East Patchogue, N.Y.
Both hospitals are defendants in a lawsuit brought forth by a whistleblower in 2005. The suit involved allegations that the hospitals fraudulently inflated their charges to Medicare patients to obtain enhanced reimbursement.
In addition to its standard payment system, Medicare provides supplemental reimbursement, called "outlier payments," to hospitals and other healthcare providers in cases where the cost of care is unusually high. Congress enacted the supplemental outlier payments system to ensure that hospitals possess the incentive to treat inpatients whose care requires unusually high costs.
The lawsuit alleged that the hospitals inflated their charges to obtain supplemental outlier payments for cases that were not extraordinarily costly and for which outlier payments should not have been paid.
Read the DOJ release on the Trinitas Regional Medical Center settlement.
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