Justice Department Accuses Mayo Clinic of Falsely Billing Medicare

The Department of Justice has accused the Mayo Clinic, based in Rochester, Minn., of violating the False Claims Act by falsely billing federal healthcare programs, such as Medicare, for lab tests that were never performed, according to a report by the Star Tribune.

The allegations stem from whistleblowers David Ketroser, MD, and three former Mayo Clinic patients who claimed the organization billed healthcare programs for thousands of pathology tests that were never rendered over the course of several years. The whistleblower lawsuit was filed in 2007, and the federal government decided to join the lawsuit in September, according to the report.

Dr. Ketroser said he first suspected Mayo's suspicious billing practices while he was representing patients in malpractice cases against the healthcare organization. After requesting from Mayo a frozen tissue slide for one of his patients, he was told the slide had been thrown out. Later, he found that Mayo had billed for a second test the same day the first test was performed but could not relinquish the test. Dr. Ketroser said that "they didn't do them" and that he had "encountered it at least 10 or 12 times," according to the report.

A Mayo spokesman said that the allegations were overexaggerated, that the billings were simply made in error and Mayo has been fully compliant with the law. However, a federal attorney handling the case said an internal memo demonstrates a Mayo official knew the improper billing had been occurring for years. The federal attorney also took issue with Mayo's stance that it had refunded more than $242,000 to the federal government in 2007 when allegations first arose, saying the organization's payment does not rectify "the full measure of damages" and that the organization had only moved to repair the situation after the DOJ began investigating, according to the report.

It is yet to be determined how much exactly Mayo might have improperly collected from the pathology tests, according to the report.

Read the news report about the DOJ's investigation of the Mayo Clinic.

Read other coverage about hospital investigations:

- Physician-Owned Hospital in Indiana Sued by Former Owners for Conspiring to Defraud

- FBI Raids California's Arrowhead Regional Medical Center

- Miami-Dade OIG Finds "Wasteful" Spending by Jackson Health's Foundation

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