Prime Healthcare accused of Medicare fraud, seeking legal action against press

Tools

In a heated battle between Prime Healthcare and California Watch, the Southern California hospital system is accused of admitting an unusually high number of emergency Medicare patients to reap the financial benefits.

California Watch on Friday reported that past patients and former employees said Prime Healthcare intentionally is keeping insured emergency patients, mostly elders, in the hospital as part of business strategy for increased Medicare payments. In addition, the publication reports Prime is currently under investigation for its billing practices by the U.S. Department of Justice, having been accused of upcoding for extra Medicare revenue; however, Prime said it is unaware of any such federal investigation.

According to the California Watch article, Prime Healthcare's percentage of Medicare patients admitted from the emergency room to hospital beds jumped from 45 percent to 63 percent after 2005 when Prime added 11 hospitals to its network.

Prime, disputing the claims, said "Taking the state average is not a fair way of reviewing admission rates as admissions patterns vary widely based on a lot of factors such as geography, average age of the seniors, how sick the seniors are, whether the patients come from nursing homes and board and care, belong to Medicare HMOs or not, and how busy the ER is and how often it closes," in a Saturday press release.

Futhermore, the CEO of Shasta Regional Medical Center, under parent company Prime Health Services, refuted any wrongdoing regarding the high rate of admitted Medicare patients. "Most of our business comes through our emergency room," said CEO Randall Hempling in a Record Searchlight article. "We focus on our emergency department, and we are proud of that."

Prime Healthcare denies the accusations, calling California Watch "nothing more than a mouthpiece for SEIU," and the "propaganda" report as "flawed," according to press releases.

Prime Healthcare is planning on suing California Watch for "repeated fraudulent and defamatory statements," according to a Friday press release from Prime.

"It is unfortunate that California Watch continues to rely on manipulated data and unsubstantiated allegations fed by Service Employees International Union (SEIU) to publish fraudulent and defamatory statements about Prime Healthcare," said Prime in the Saturday press release.

At press time, California Watch's "Editor's Note" mentioned the publication had not been served and could not fully comment, but the publication stands by its reporting. "[T]he company has yet to present to us a single factual error that has merited correction or clarification," said the California Watch editor about Prime.

To learn more:
- read the California Watch article
- read the California Watch methodology
- read The Record Searchlight article
- here's the Prime Healthcare press release on Friday
- here's the Prime Healthcare press release on Saturday

Related Articles:
Why hospitals must approve big premium hikes
Investigation shows hospital erroneously billed Medicare for infections
High malnutrition rates at Prime Healthcare hospitals raise doubts