February 24, 2023

False Claims Act: Medical Center Pays Millions to Settle Medicare Fraud Allegations

On February 22, the United States Attorney’s Office announced that Cornerstone Healthcare Group Holding Inc. and CHG Hospital Medical Center LLC agreed to pay the United States more than $21 million to resolve claims that the company violated the False Claims Act by improperly billing Medicare. Cornerstone Healthcare Group allegedly billed for unauthorized services as well as for services which were never provided and ones that were deemed so inadequate that they were essentially worthless. Learn more about how to report Medicare fraud here.

Cornerstone Medical Center was formerly a long-term acute care facility which operated as a long-term care hospital. Cornerstone provided extended medical and rehabilitative care to individuals who qualified as clinically complex and possessed several acute or chronic conditions.

This case was brought to the government’s attention when a whistleblower filed a lawsuit under seal back in 2018. The whistleblower worked at Cornerstone Medical Center long term care facility and witnessed unlicensed and unauthorized students of several doctors rendering medical procedures. These services, which were unauthorized and improper were then fraudulently billed to Medicare. Further, the whistleblower reported that Cornerstone Medical Center submitted claims for payment for services that certain treating physicians supposedly rendered. However, records demonstrated that the physicians were out of the country and could not provide those services. Ophthalmologist fraud and Medicare fraud represent alarming facets of financial deception within the healthcare industry. Learn more how to report ophthalmologist fraud here.

The whistleblower also revealed that from 2012 through 2018, Cornerstone Medical Center billed for services not supported by the patient’s diagnosis or medical records and for services that were not properly administered which in some cases, resulted in harm to the patient. The claims for payment to Medicare for those services were fraudulent and in violation of federal law.
Healthcare fraud continues to be a pervasive problem which impacts not only the patients who are in same cases hurt by having to undergo unnecessary procedures, but the public at large by wasting taxpayer dollars and resulting in higher healthcare premiums. Whistleblowers play an enormous role in stopping Hospice fraud and Medicare fraud, which according to the Government Accounting Office, costs the United States $60 billion annually. The False Claims Act is one of the most powerful tools at the government’s disposal to combat healthcare fraud.

 

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