CHS to pay more than $98M to settle DOJ billing probe

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Franklin, Tenn.-based Community Health Systems has agreed to pay more than $98 million to resolve a government investigation over the hospital operator's billing practices.

The U.S. Department of Justice began an investigation into the billing practices at CHS' 119 facilities in 2011. The billing probe covered the period from January 2005 to December 2010. The government claimed CHS had billed Medicare, Medicaid and TRICARE for expensive short-stay admissions through emergency departments, which should have been billed as outpatient or observation cases.

CHS has agreed to pay $89.15 million to resolve all of the federal government claims concerning Medicare, TRICARE and the federal share of Medicaid claims. In addition, CHS will pay $892,500 to the states for their portions of the Medicaid claims. The DOJ did not specify the states that were getting a portion of the settlement proceeds.

The settlement also resolves the government's investigation into a CHS-affiliated hospital in Laredo, Texas. CHS has agreed to pay $9 million to resolve that investigation. 

As part of the settlement, CHS entered into a five-year Corporate Integrity Agreement that will be incorporated into the hospital operator's existing compliance program.

Under the settlement agreement, cases brought in Illinois, Tennessee, North Carolina, Texas and Indiana under the qui tam, or whistle-blower, provision of the False Claims Act will also be dismissed. 

"Our organization is dedicated to high ethical standards as we strive to operate in a complex and ever changing regulatory environment," said Wayne T. Smith, chairman and CEO of CHS, in a news release.

Although CHS has agreed to this settlement, there has been no admission of wrongdoing.

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