On Aug. 3, the U.S. Department of Justice reached a settlement with Prime Healthcare and its CEO Dr. Prem Reddy have agreed to pay $65 million to settle allegations of Medicare over-billing for false claims across 14 Prime hospitals in California. A San Diego whistleblower Karin Berntsen, will receive $17.2 million for her reporting of the alleged fraud.
Berntsen was the former director of performance improvement at Alvarado Hospital, one of the 14 facilities named in the settlement. She filed a suit against the company in 2011 alleging fraudulent billings, which two years later turned into a formal complaint after the government intervened. Under the False Claims Act, Berntsen and her attorneys are entitled to up to 30 percent of money recovered by the government as a result of her complaint.
“The patients were becoming commodities,” said Berntsen in a statement, “They were becoming dollar signs, not people. Everything being done seemed to be solely to increase profit.”
Prime, one of nation’s largest hospital networks, and its CEO agreed to the settlement under the allegations they “up-coded” patient diagnoses, exaggerating the degree of their condition to receive more money from Medicare and admitted patients with no real necessity.
In a statement, Prime said, “physicians, not hospitals, direct the level of care needed for their patients. Prime continues to support physicians in the care they determine is best.”
Dr. Reddy will pay $3.25 million, and Prime will cover the rest as per the settlement agreement.
In a press release from the Department of Justice, first assistant U.S. attorney Tracy Wilkinson said, “patients and taxpayers who finance health care programs such as Medicare deserve to know that doctors are making decisions solely based on medical need – and not based on a corporate desire to increase billings.”
Check out the LA Times article on Bernsten.
Read the original article by AP News.
For the Department of Justice’s press release, click here.