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NY City hospital will pay $89 million to resolve fraud allegations

By Phillips & Cohen LLP

New York's Staten Island University Hospital will pay $88.9 million to settle allegations it had defrauded Medicare, Medicaid and an insurance program covering the military. According to the U.S. Dept. of Justice, the federal government will receive $74 million and New York State will receive $14.9 million. The settlement reflects, in part, whistleblower suits brought under the federal and New York False Claims Acts. Those relators will receive a total of $9.9 million.

The federal whistleblower suit claimed that SIUH fraudulently billed Medicare for stereotactic body radiosurgery treatment that was provided on an out-patient basis to cancer patients. The investigation established that from 1996 through 2004, SIUH defrauded Medicare and TRICARE by knowingly using incorrect billing codes for cancer treatment performed at the hospital. By using incorrect codes, SIUH obtained reimbursement for treatment that was not covered by Medicare or TRICARE.

Attorney General Andrew M. Cuomo said that the settlement with Staten Island University Hospital will return $24,806,471 to Medicaid, a program jointly funded by the state and federal governments. Of this amount, the State of New York will receive a total of $14,883,883.

The New York State portion of the suit alleged that SIUH billed Medicaid for inpatient detoxification treatment provided in a special unit within the hospital for which SIUH had not obtained a certificate of operation from the State.

Full post as published by False Claims Act - Qui Tam on September 16, 2008 (boomark / email).