Banner Health will pay $18M to settle false claims allegations

Banner Health, a 28-hospital system based in Phoenix, has agreed to pay the federal government more than $18 million to resolve allegations that 12 of its hospitals in Arizona and Colorado submitted false claims to Medicare, according to the Department of Justice.

The government alleged from Nov. 1, 2007, through Dec. 31, 2016, Banner Health billed Medicare for short-stay inpatient procedures provided at the 12 hospitals that should have been billed on a less costly outpatient basis. The government further alleged Banner inflated the number of hours patients received outpatient observation care in reports submitted to Medicare.

In addition to the monetary settlement, Banner entered a five-year corporate integrity agreement with HHS' Office of Inspector General. The agreement requires the health system to retain an independent organization to review the accuracy of Banner's claims for services provided to beneficiaries of federal healthcare programs, according to the DOJ. 

The allegations against Banner were originally brought under the qui tam, or whistle-blower, provisions of the False Claims Act by a former employee. 

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