Massachusetts hospital to pay $24M in whistleblower case

Cape Cod Hospital in Hyannis, Mass., will pay $24.3 million to settle claims that it knowingly billed Medicare for cardiac procedures that didn't follow Medicare rules.

The settlement resolves allegations that Cape Cod Hospital knowingly submitted hundreds of claims to Medicare from November 2015 through December 2022 for transcatheter aortic valve replacement procedures that did not comply with Medicare requirements.   

TAVR are minimally invasive procedures in which a diseased aortic valve is replaced with a manufactured valve. Medicare established its coverage policy for TAVR in 2012.

When Cape Cod Hospital began offering TAVR in 2015, Medicare required hospitals to follow specific steps before performing the procedure. These steps include clinical personnel conducting an independent examination of prospective patients to evaluate suitability for TAVR; documentation of the rationale behind clinical judgment; and making said rationale available to the medical team performing the TAVR procedure.

The U.S. Attorney's Office for the District of Massachusetts reported that the investigation found the hospital failed to follow these reimbursement protocols. Prosecutors claimed that, in some cases, there were not enough physicians evaluating a patient's suitability for the procedure, and in other cases, the physicians did not document or share their clinical judgment with the TAVR medical team.

The allegations stem from claims brought against the hospital under the whistleblower provisions of the False Claims Act. Richard Zelman, MD, former cardiovascular medical director at Cape Cod Hospital, brought the claims and will receive approximately $4.36 million of the recovery. 

Cape Cod Hospital is a nonprofit, independent community hospital. It has 259 staffed beds and total patient revenue of $1.6 billion, according to the American Hospital Directory. The hospital has a team of approximately 5,000 employees and 550 physicians.

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