Indiana declines to join fraud case against 62 hospitals

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Like the feds, the Indiana Attorney General's Office declined to intervene in a case against 62 hospitals across the state. (Getty/eccolo74)

The state of Indiana will not join a whistleblower lawsuit that alleges dozens of Indiana hospitals fraudulently received more than $324 million in EHR incentive payments.

The decision follows a similar move by the Department of Justice earlier this year, which also declined to intervene in the case.

The lawsuit, which was unsealed last month, alleges 62 hospitals across Indiana violated the False Claims Act by submitted fraudulent data tied to a specific Meaningful Use requirement that mandates hospitals fulfill electronic patient records requests within three business days.

Filed by two Indiana attorneys that became frustrated with delays in obtaining medical records, the lawsuit also named Georgia-based Ciox Health, which facilitates record requests for hospitals around the country.

RELATED: Unsealed lawsuit claims 62 Indiana hospitals, Ciox Health triggered fraudulent EHR incentive payments

But just as the U.S. government declined to join the case, the Office of the Indiana Attorney General elected not to intervene, but reserved the right to join at a later date. Additionally, the court indicated it will solicit written consent from the state prior to dismissing the case or approving a settlement.

Meanwhile, on Monday the plaintiff’s filed a motion to submit a second amended complaint adding “a series of dates and factual details” to some of the original claims and clarifying the legal theories associated with the False Claims Act.

After the case was filed, Ciox Health issued a statement noting the company does not comment on pending litigation, “specifically cases which have no merit,” but added that it has “more than 40 years of experience in the industry and we firmly stand behind our business, our customers and the patients we serve.” Memorial Hospital of South Bend, which is named as a defendant, has also said the claims are without merit.