Sacramento, Calif.-based Sutter Health, and its affiliate Sutter Bay Hospitals, will pay more than $13 million to resolve allegations that they violated the False Claims Act by improperly billing for lab tests, the Justice Department said Oct. 17.
Prosecutors alleged that Sutter Health billed the U.S. for urine toxicology specimens performed by outside labs. Prosecutors specifically alleged that Navigant Network Alliance, per a contract with Sutter Health, referred lab tests obtained from physicians and laboratories nationwide to the health system, which submitted bills, or caused the submission of bills, for reimbursement of the testing it performed on the specimens.
Between Aug. 1, 2016, and June 30, 2017, Sutter Health sought reimbursement from the Federal Employees Health Benefits Program, Medicare, Medicaid, and Tricare for the tests — and was paid for the tests — even though the tests were performed by third-party labs, the Justice Department said.
The settlement resolves these allegations, and Sutter Health has already paid the U.S. more than $6.5 million of the total $13.1 million amount agreed to.
A Sutter Health spokesperson declined Becker's request for comment.