Hospitalist Company Facing Scrutiny by Department of Justice in Up-Coding Case

As you are likely aware, Medicaid and Medicare are federal programs offering health care coverage based on age or financial need. If a healthcare facility is treating a patient with coverage under one or both of these programs, it must submit an invoice for services which is later reimbursed. During this process, the facility creates a bill using a series of codes which correspond to the particular service or product used by the patient. Under federal laws, the codes must correspond with the precise form of treatment offered and facilities are prohibited from entering any code for reimbursement that does not accurately represent the service offered by the facility.

Violations of this requirement are punishable under many statutes, including the False Claims Act. One way this requirement can be violated is by “upcoding.” The term “upcoding” refers to the practice of billing a healthcare entity for a most costly service than the patient actually received, resulting in an inflated reimbursement amount and fraudulent profits for the healthcare facility.

IPC is alleged to have engaged in upcoding fraud. Image from bergermontague.com

United States v. IPC The Hospitalist Company

In a recent case involving allegations of unlawful upcoding, the United States opted to intervene against California-based hospitalist company IPC  The complaint, filed by a former IPC physician, Dr. Bijan Oughatiyan, alleged that IPC doctors invoiced Medicare and Medicaid for levels of medical service that were either never rendered or were rendered in a different, less expensive, procedure. The complaint continued by alleging that IPC instructed its doctors to bill for services at the highest possible levels and even trained doctors on how to upcode. Doctors were allegedly routinely monitored and encouraged to “code higher” if their numbers lagged behind those of their peers.

Under the FCA, once an individual files a whistleblower lawsuit individually, the United States has an opportunity to join the suit, also known as intervening. When this happens, the government is able to use its investigative resources to dig deeper into the allegations, uncovering possible greater widespread fraud. Earlier this week, the U.S. decided to join the case against IPC and commented that it “continue[s] to be vigilant in our enforcement efforts to ensure that health care programs funded by the taxpayers pay only for appropriate costs.”

Successful Whistleblowers Often Litigate Without Government Intervention

If you are aware of fraudulent practices at your place of employment, or the concept of “upcoding” sounds familiar to you, you may be a prime candidate for an individual whistleblower lawsuit. For more information about how you can start your qui tam action, contact a whistleblower attorney today.

By | 2014-01-09T17:05:44+00:00 January 9th, 2014|False Claims Act Legal News, Healthcare Fraud|