Carondelet Settles False Medicare Claims for $35M; Whistleblower Amount TBD
Arizona non-profit Carondelet Health Network, doing business as Carondelet St. Mary’s Hospital and Carondelet St. Joseph’s Hospital in Tucson, Ariz., has agreed to pay the United States $35 million to settle allegations that the hospitals knowingly submitted or caused the submission of false claims to Medicare and other federal health care programs, the U.S. Attorney’s Office for the District of Arizona announced yesterday.
The settlement agreement resolves allegations that Carondelet St. Mary’s Hospital and Carondelet St. Joseph’s Hospital billed Medicare, the Federal Employees Health Benefit Program, and the Arizona Health Care Cost Containment System (Arizona’s Medicaid agency) for inpatient rehabilitation facility services that were not properly reimbursable under applicable coverage criteria because the patients were not appropriate for inpatient rehabilitation facility services. The United States alleged that as a result of these false claims, federal health care programs paid substantially more than was warranted.
Shortly before becoming aware of the United States’ investigation, Carondelet disclosed to the government some inpatient rehabilitation overpayments and tendered a substantial repayment. However, based on its investigation, the United States had concerns about the nature of Carondelet’s disclosure, including concerns that the disclosure and the repayment Carondelet tendered were not timely, complete, or adequate. Despite these concerns, the United States considered Carondelet’s efforts in this regard as one of several factors in reaching the settlement amount and the resolution of the case. The settlement is neither an admission of liability by the hospitals, nor is it a concession by the United States that its claims are not well founded.
The lawsuit was originally filed by Jacqueline Bloink under the whistleblower provision of the False Claims Act, which allows private parties with knowledge of fraud against the government to sue on behalf of the government and share in the recovery. Bloink’s portion of the settlement has yet to be determined.
The Chanler Group, in association with the Hirst Law Group, represents whistleblowers who take action under the False Claims Act to report fraud committed against the federal and state governments. We have years of experience representing whistleblower clients who expose every kind of fraud against the government, including health care fraud, contract fraud, and tax fraud. Read more about our expertise in False Claims Act cases and how you can take action.