Feds Crack Down on Inflated Admissions, Tests

When the business news pages start talking about medicine, you are probably not going to hear about the latest breakthroughs in treatments or research. These days, what you most likely will hear is the sound of whistles blowing.

The New York Times was among the national news outlets that recently reported the U.S. Department of Justice had joined eight separate whistle-blower lawsuits against Health Management Associates (HMA), a large, for-profit hospital chain. The actions were filed by doctors and administrators from six states who had worked for HMA-owned hospitals.

The suits allege that HMA engaged in widespread policies that violated the federal False Claims Act and the Stark anti-kickback laws, to increase revenues by billing Medicare and Medicaid for inflated and unnecessary services. Among the allegations leveled against HMA:

  • That hospital administrators kept a daily scorecard on the percentage of patients admitted by individual doctors and pressured the practitioners to make unnecessary admissions.
  • That doctors were ordered to admit at least 50 percent of emergency room patients over age 65, whose bills would be paid by Medicare.
  • That doctors who failed to meet target admission levels, and administrators who questioned or refused to support the policy, were harassed or fired.
  • That emergency room physicians were required –– and in some cases, offered cash incentives — to order fraudulent and medically unnecessary tests.
  • That the hospitals used computer software to automatically order batteries of tests for emergency room patients, usually before they were even seen by a doctor.
  • That HMA, along with another hospital chain in Georgia, gave kickbacks to clinics in Hispanic neighborhoods for referring undocumented pregnant women, whose deliveries are covered by Medicaid as emergency services despite their status as illegal immigrants.

HMA denies the allegations and claims all of its policies are designed to promote the highest quality of patient care. Even so, the lawsuits send a warning to medical practitioners to be cautious about practices that could be interpreted as fraudulent. If you have any doubts, consult a knowledgeable health care attorney for risk management and compliance counseling.

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Posted in: Compliance