A number of settlements by hospitals and health systems involved the failure to adhere to reimbursement or coverage requirements, 42 including one such settlement by St. Joseph’s Hospital and an affiliated physician practice for $10 million related to alleged concurrent and overlapping surgeries. 43 Many others resolved cases related to medical necessity issues, including allegations of inappropriately billing or coding claims. 44 In the largest settlement involving a hospital or health system in FY 2021, Sutter Health and affiliated entities agreed to pay $90 million and enter into a five-year Corporate Integrity Agreement (CIA) to resolve allegations that they submitted unsupported diagnosis codes to Medicare Advantage plans to increase reimbursement. LONG-TERM CARE PROVIDERS DOJ continued its focus on the medical necessity of services rendered by long-term care providers. Multiple skilled nursing facilities (SNF), home health companies and a hospice company resolved allegations that they billed federal healthcare programs for services that
The pharmaceutical and medical device sectors of the healthcare industry continued to constitute a significant source of recovery within the healthcare industry last year Many of the larger settlements in these sectors related to product defects and many others involved allegations of AKS violations.
COMPARISON OF TOTAL RECOVERIES: INTERVENED V. DECLINED CASES SETTLEMENTS AND JUDGMENTS (FY 2017-2021)
were either medically unnecessary or not rendered at all. 45 In addition, two providers of rehabilitation services for SNF patients settled allegations that they billed Medicare for rehabilitation therapy services that were not medically necessary, reasonable or skilled. 46 Other settlements involving long-term care providers related to alleged violations of the AKS and the Stark Law. As one example, home health agency operator BAYADA Home Health Care, Inc., and several affiliated entities agreed to pay $17 million to resolve FCA allegations that they purchased two home health agencies in order to obtain referrals of Medicare beneficiaries from other retirement communities operated by the seller of the home health agencies, in violation of the AKS. 47
YEAR INTERVENED CASES DECLINED CASES
2017
$2.55 billion
$602.68 million
2018
$2.00 billion
$135.22 million
PHARMACEUTICAL AND MEDICAL DEVICE COMPANIES
2019
$1.94 billion
$305.52 million
2020
$1.51 billion
$193.88 million
The pharmaceutical and medical device sectors of the healthcare industry continued to constitute a significant source of recovery within the healthcare industry last year Many of the larger settlements in these sectors related to product defects and many others involved allegations of AKS violations.
2021
$1.19 billion
$479.01 million
45 https://www.justice.gov/usao-mdtn/pr/savaseniorcare-llc-agrees-pay-112-million-resolve-false-claims- act-allegations; https://www.justice.gov/usao-edca/pr/california-s-second-largest-skilled-nursing-facility- operator-pays-450000-resolve-false; https://www.justice.gov/usao-edmi/pr/usmm-and-vpa-pay-85- million-resolve-overpayment-medicare-claims-laboratory-and; https://www.justice.gov/usao-or/pr/ bend-resident-and-affiliated-residential-care-company-agree-pay-29-million-settle-health; https://www. justice.gov/opa/pr/crossroads-hospice-agrees-pay-55-million-settle-false-claims-act-liability. 46 https://www.justice.gov/opa/pr/contract-rehabilitation-therapy-providers-agree-pay-84-million-resolve- false-claims-act; https://www.justice.gov/opa/pr/interface-rehab-pay-2-million-resolve-false-claims-act- allegations. 47 https://www.justice.gov/usao-nj/pr/home-health-agency-operator-pay-17-million-resolve-false-claims-act- kickback-allegations.
42 https://www.justice.gov/usao-wdny/pr/upper-allegheny-health-system-pay-27-million-settle-false-claims- act-allegations; https://www.justice.gov/usao-mdpa/pr/geisinger-community-health-services-agrees-18- million-civil-settlement. 43 https://www.justice.gov/usao-az/pr/neurosurgical-associates-ltd-and-dignity-health-dba-st-josephs- hospital-paid-10-million. 44 https://www.justice.gov/opa/pr/ascension-michigan-pay-28-million-resolve-false-claims-act-allegations; https://www.justice.gov/opa/pr/county-medical-center-and-county-agree-pay-114-million-resolve- false-claims-act-allegations; https://www.justice.gov/usao-cdil/pr/federal-and-state-authorities-reach- settlement-blessing-hospital-over-medicare-and; https://www.justice.gov/usao-ndtx/pr/hospital-pay- more-3-million-settle-whistleblower-suit.
NOTEWORTHY SETTLEMENTS BASS, BERRY & SIMS | 8
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