Oklahoma hospital, Aetna accuse management company of billing fraud

Shattuck, Okla.-based Newman Memorial Hospital and Aetna filed lawsuits against People's Choice Hospital, an Oak Brook, Ill.-based management company, alleging People's Choice committed billing fraud, according to News OK.

Newman Memorial Hospital tapped People's Choice, which aims to turn around financially struggling hospitals, for financial assistance after the rural hospital nearly closed in May 2016. In its complaint, the hospital claimed People's Choice told Newman Memorial's administration it could keep the hospital afloat if it followed a plan to bring in and bill more lucrative lab tests.

In its lawsuit, Aetna accused People's Choice of sending samples from blood and urine tests to other labs and falsely claiming Newman Memorial processed the tests. Aetna claims it lost $21.6 million on more than 10,000 bills for lab tests over 16 months, according to News OK. The insurer's lawsuit states it paid about $2,250 for some tests it thought were performed at the rural hospital, compared to the $120 it would have paid at a larger lab.

People's Choice denies the allegations. Newman Memorial and People's Choice settled the hospital's lawsuit out of court. Their arrangement was undisclosed.

Aetna has not pursued any repayment from Newman, alleging People's Choice and its partners collected most of the lab revenue, according to News OK.

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