settle

Stryker, former division settle false claims allegations

Fri, 16 Nov 2007 06:59:54 -0500

Medical technology provider Stryker Corp., along with former outpatient therapy division Physiotherapy Associates, have agreed to pay $16.6 million to settle allegations that they'd submitted false claims to federal healthcare programs. The settlement resulted from whistleblower suits filed by two private citizens, both former Physiotherapy employees, each of whom will receive $3 million from the settlement.

The U.S. Department of Justice had contended that Physiotherapy submitted false claims to Medicare, state Medicaid programs and the Department of Defense's TRICARE plan. It also said that Physiotherapy had retained reimbursements which were improperly paid, rather than refunding them. In addition to paying the fine, Physiotherapy will enter into a corporate integrity agreement with the HHS Office of Inspector General.

Physiotherapy was purchased from Stryker for $150 million in June, by Chicago's Water Street Healthcare Partners.

To learn more about the settlement:
- read this Memphis Business Journal piece

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AZ hospital, MDs pay $6.7M to settle Medicare charges

Tue, 06 Nov 2007 06:59:55 -0500

An Arizona hospital and two affiliated medical groups have agreed to pay the U.S. Department of Justice $6.7 million to settle charges that they billed Medicare improperly. The DoJ had contended that the facility, Phoenix's Arizona Heart Hospital, inappropriately billed Medicare for procedures related to experimental grafts for aneurysms, as the grafts were considered experimental or procedures involved didn't follow approved protocols.

The hospital, which is majority-owned by MedCath Corp., is also co-owned by physician groups AHI Cardiovascular Surgeons and Arizona Heart Institute. The two groups paid $900,000 of the total settlement amount. MedCath had previously announced that it would pay $5.8 million to settle clinical trial issues at one of its hospitals, though it didn't name the facility at that time.

To learn more about the settlement:
- read this Modern Healthcare piece
- read this Charlotte Business Journal article

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FL hospital sued over sale of $1.9B in bad debt

Mon, 15 Oct 2007 06:59:57 -0400

On the surface, the deal looked like a win-win. Giant Jackson Memorial Hospital would be able to sell--and make some money on--eight years worth of outstanding bills. Collector International Portfolio Inc.(IPI), meanwhile, would make more than $108.6 million on its $5.7 million investment. The thing is, it didn't work out that way, according to IPI, which has sued the 1,757-bed public hospital in an attempt to resolve its problems with Jackson.

IPI is alleging that the $1.9 billion in accounts receivable sold by Jackson wasn't as collectible as it was supposed to be. Its attorneys say that the accounts didn't meet the terms of the sale, including patients who were dead, bankrupt, on Medicare or Medicaid or simply didn't owe what the records suggested. When Jackson got the news, it gave IPI another batch of receivables, but the accounts were only worth $682 million, with many lacking adequate collections information, IPI says.

Since then, the dispute has raged on. Jackson has told many patients with unpaid accounts that they have a zero balance, and has apologized for IPI's collection efforts. Now, it looks like a judge will have to sort things out. In the future, perhaps Jackson will sell accounts for a contingency fee, as is more typically the case when hospitals pursue bad debt collections.

To find out more about the suit:
- read this South Florida Business Journal piece

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Smith & Nephew settles kickback charges

Fri, 28 Sep 2007 06:59:57 -0400

Orthopedic device maker Smith & Nephew has become the latest of a group of orthopedic device makers to settle kickback charges. The company agreed to pay $29 million to the U.S. Attorney for the District of New Jersey to settle charges that it engaged in sham consulting contracts with doctors. Smith & Nephew is one of four companies targeted by the investigation; others include Zimmer Inc., DePuy Orthopedics and Biomet, all of which make artificial hip and knee construction and replacement products.

All four of the companies have been accused of setting up consulting agreements with orthopedic surgeons as a method of inducing them to use the given company's devices. The surgeons were given not only tens to hundreds of thousands of dollars per year, but also rich perks like luxurious trips. Collectively, the companies have agreed to pay $311 million to settle violations of the anti-kickback statute and civil federal False Claims Act.

To find out more about the settlement:
- read this Memphis Business Journal article

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Medtronic faces more kickback accusations

Thu, 27 Sep 2007 06:59:58 -0400

Despite having spent $40 million to settle kickback charges, medical device maker Medtronic has continued to pay millions in consulting fees to spine surgeons, according to a whistle-blower involved in the case. Now Sen. Charles Grassley (R-IA) is asking Medtronic to explain consulting payments made after the July 2006 settlement, which addressed charges that the company had lured doctors with "sham consulting agreements, sham royalty agreements and lavish trips to desirable locations."

According to the whistle-blower's attorney, Medtronic made payments of almost $6 million in consulting fees, with some surgeons being paid in the high six figures in a single year. Medtronic, for its part, isn't denying that it's made consulting payments, but says that the payments weren't kickbacks. Instead, it says, it paid doctors a legitimate fee to assist the company in determining how its devices could be best designed and used.

To find out more about the pending investigation:
- read this piece in The New York Times

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Tenet fights bankruptcy rumors

Thu, 30 Aug 2007 06:59:58 -0400

Tenet has been through many troubles, but until recently, no one had publicly suggested the hospital giant was in danger of capsizing. Now, a stock analyst has raised concerns--which the company has been fighting to quell--that it might face bankruptcy within three years. Tenet is responding to a a Credit Suisse report suggesting existing threats to its profits, including its reliance on Medicare outlier payments, could destabilize it completely.

Of late, Tenet has been in turnaround mode, with execs working to restructure services within individual hospitals, improve collections and strengthen managed care contracts. To date it appears to have had some success, but lower-than-hoped-for patient volumes continue to be a problem. Also, the company still is recovering from its extensive legal troubles, which last year included a $725 million payment to settle Medicare billing charges.

To learn more about the analyst ratings kerfuffle:
- read this Modern Healthcare article (reg. req.)
- read this Tenet press release

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HCA to pay $20M to settle shareholder suits

Thu, 16 Aug 2007 06:59:58 -0400

HCA has agreed to pay $20 million to settle a group of shareholder suits that accused the company of making misleading statements in early January 2005. The suits contended the execs spoke highly of their prospects in January, but released bad news in July 2005, selling almost 1 million shares of stock in the interval. (If true, that certainly does raise some questions.)

After the lawsuits were filed, the SEC and the U.S. attorney in New York filed subpoenas to HCA and former Senator Bill Frist to determine whether insider trading took place. However, neither agency filed charges. Nonetheless, HCA settled on the civil suit, keeping larger questions of potential wrongdoing off the table. Smart move, I think.

To learn more about the settlement:
- read this article

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Report: Young adults swell ranks of the uninsured

Wed, 08 Aug 2007 06:59:58 -0400

About 30 percent of the nation's estimated 44.4 million people without health insurance are 19-29 years old, making young adults the largest group of newly uninsured, according to a Commonwealth Fund study. In 2005, about 13.3 million people in this age range lacked coverage, up from 12.9 million a year earlier.

The researchers blame several factors for the bump, particularly the fact that many get dropped from their parents' health insurance or public coverage for children when they turn 19 or graduate from college. And when they enter the working world, young adults often settle for low-wage or temporary jobs without health benefits. Low-income Americans are disproportionately affected.

The report says lack of coverage puts their health at risk and can add financial stress to their lives just as they're starting out in the workforce.

For the full report:
- Start with the Commonwealth Fund's issue brief.

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Small buy means big change for Tenet

Sun, 01 Jul 2007 20:01:38 -0400

Picking up a single 41-bed hospital usually isn't a big deal for a hospital chain the size of Tenet. But in this case, its acquisition of Hardeeville, S.C.-based Coastal Carolina Medical Center is a significant move, as it's Tenet's first acquisition in five years after years of focusing on existing properties. Executives with Tenet say the $35 million acquisition is a significant step for the company, which has been in turnaround mode for four years.

Tenet is only just emerging from a thicket of legal troubles. A year ago, it agreed to pay $900 million to settle Medicare fraud charges. Three months ago, it agreed to pay $10 million to settle similar challenges from the Securities and Exchange Commission. Now, execs need to turn a profit. The company has lost money every year between 2003 and 2006, including an $800 million loss last year.

To find out more about Tenet's plans:
- read this article from The Dallas Morning News

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AZ ambulance firm settles with US DOJ

Mon, 11 Jun 2007 20:01:38 -0400

Scottsdale, AZ-based ambulance firm Rural/Metro has settled with the U.S. Department of Justice over a pair of whistleblower suits alleging that it had offered kickbacks in exchange for Medicare and Medicaid business. Rural/Metro has agreed to pay $2.5 million to settle the 2000 and 2001 suits, which asserted that the company had offered discounts to Texas hospitals in return for contracts to provide services billable to the state and federal entities. (Competitor American Medical Response previously paid $9 million to the DOJ to settle similar allegations.) As part of the settlement, whistleblowers Daniel Block and Adam Wightman will receive $450,000. Rural/Metro serves 365 communities and has more than 8,000 employees. It reported annual revenues of $450.9 million for fiscal 2006.

To get more background on the settlement:
- read this Modern Healthcare article (sub. req.)

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