Three New York hospitals and a healthcare management company have agreed to collectively pay $8 million to settle allegations that they submitted false claims to New York's Medicaid program for drug and alcohol treatment services, according to an announcement from the New York Attorney General Eric T. Schneiderman.
State prosecutors alleged that SpecialCare Hospital Management Corporation illegally referred patients to unlicensed treatment programs at Columbia Memorial Hospital, St. Joseph's Medical Center and Benedictine Hospital in exchange for kickbacks under the guise of providing administrative services. The hospitals allegedly submitted claims to Medicaid for unlicensed and medically unnecessary inpatient detoxification services. SpecialCare, along with its former CEO Robert McNutt, will pay $6 million, while the three hospitals have agreed to pay $2 million collectively. Announcement