Tenet to pay $43M to settle Medicare fraud allegations

Tenet Healthcare Corporation will be forking over $42.75 million to settle allegations that it violated the False Claims Act by overbilling Medicare for more than two years at 25 Tenet inpatient rehabilitation units, the U.S. Department of Justice said yesterday. It's the single largest recovery pertaining to inappropriate admissions to inpatient rehabilitation facilities.

The Dallas-based health system allegedly billed Medicare between May 15, 2005, and Dec. 31, 2007, for treating patients at its inpatient rehabilitation facilities when these patient stays did not meet the standards to qualify for an inpatient rehabilitation facility admission, the Justice Department said.

Tenet's agreement with the U.S. Attorney's Office, Northern District of Georgia and the Departments of Justice and Health & Human Services is a voluntary civil settlement. As part of an internal 2007 review, Tenet's compliance department identified overpayments related to an inpatient rehabilitation unit at one of its facilities where patients could have been treated at a lower level of care. Tenet "promptly notified the OIG of its findings," as required by self-disclosure regulations, the health system said in a statement yesterday.

"The Department of Justice is committed to protecting the Medicare program against all types of overcharging by healthcare providers," Stuart F. Delery, acting assistant attorney general for the civil division, said in the DoJ statement.

U.S. Attorney for the Northern District of Georgia Sally Quillian Yates continued, "This settlement demonstrates our office's continued commitment to protect crucial Medicare dollars from fraud and abuse. Inpatient rehabilitation facilities are expensive, and Medicare dollars should be reserved for patients who need the services--not for hospitals seeking to make money through improper billing."

Since January 2009, the Justice Department's recoveries though the False Claims Act has totaled more than $6.6 billion in cases involving fraud against federal healthcare programs.

Tenet will pay out the cash settlement in its second quarter this year, the company said.

For more information:
- read the DoJ press release
- see the Tenet statement (.pdf)

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