Hospital admits accepted improper payments from federal health insurance programs for more than five years...and only has to pay 36 mil?

"We expect health-care providers to come forward when they discover issues that could rise to the level of fraud without waiting for us to catch up to them," Fitzgerald said in a statement announcing the settlement.


Hospital settles fraud case for $36M
December 1, 2008 at 11:16 PM | Comments (0)

Condell Medical Center in Libertyville will pay a $36 million settlement to government health programs after the hospital said it accepted improper payments from federal health insurance programs for more than five years, the U.S. attorney's office in Chicago said Monday.

The improper payments, which Condell executives brougto the attention of the U.S. attorney, were uncovered in the process of the medical center's due diligence with Advocate Health Care, which Monday finalized a deal to buy the 283-bed hospital in Lake County for $180 million.

The settlement resolves deals that included improper loans made to physicians, leases with doctor practices that were below fair market value and hospital payments to doctors who performed "patient services without required written agreements," the U.S. attorney's office said in a statement.

Such deals were in violation of federal laws that essentially prohibit hospital payments to doctors for patient referrals. If a hospital, for example, leases space to a physician at below fair market value, that can be construed as a way to encourage doctors to send patients to the hospital leasing the space.

The deals led to millions of improper payments to the hospital from the Medicare health insurance program for the elderly and the state Medicaid health insurance program for the poor. The settlement, which involves improper deals from 2002 through 2007, calls for Condell to pay the federal government $33.12 million to resolve claims related to Medicare and $2.88 million to resolve claims related to Medicaid.

As part of the settlement, the U.S. attorney's office said Condell "does not admit liability and agreed to the settlement to avoid the delay, uncertainty and expense of protracted litigation."

"We regret that in the past Condell may have been engaged in any practices that were not compliant with the law, and remain committed to the highest standards of conduct," said Dennis Millirons, Condell's chief executive officer.

By voluntarily disclosing the illegal relationships and contracts, "Condell avoided a government lawsuit under the federal False Claims Act and was able to negotiate a settlement at a discount," the U.S. attorney's office said. Such a lawsuit could have led to a settlement that would have cost Condell another $10 million or more, according to federal formulas used to calculate health care settlements.

Still, U.S. Atty. Patrick J. Fitzgerald praised Condell "for bringing these practices" to the government's attention.

"We expect health-care providers to come forward when they discover issues that could rise to the level of fraud without waiting for us to catch up to them," Fitzgerald said in a statement announcing the settlement.

--Bruce Japsen
http://www.chicagobreakingnews.com/2008/12/condell-fraud-settlement.html