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July 14, 2020 News

UHS to Pay $117 Million to Settle False Claims Act Allegations for Medically Unnecessary Inpatient Psychiatric Services and Illegal Kickbacks

PHILADELPHIA, July 14, 2020 – Berger Montague PC, a full-spectrum class action and complex civil litigation law firm with one of the most successful whistleblower practices in the U.S,  announced today that Universal Health Services, Inc. and UHS of Delaware, Inc. (together, “UHS”), have agreed to pay $117 million to resolve alleged violations of the False Claims Act. UHS, based in King of Prussia, PA, owns and manages nearly 200 acute care inpatient psychiatric hospitals and residential psychiatric and behavioral treatment facilities nationwide. The allegations involved billing the Government for medically unnecessary inpatient behavioral health services and illegal kickbacks.

Sherrie Savett, the Chair of the Whistleblower, Qui Tam & False Claims Act Department at Berger Montague, and partners Joy Clairmont and Russell Paul represented a whistleblower client who filed a False Claims Act case in 2013. Under the qui tam provisions of the False Claims Act, a private citizen may serve as a whistleblower and bring a case on behalf of the Government and share in any recovery. The settlement resolves 18 whistleblower cases which will share in the whistleblower portion of the recovery.

As part of the settlement, UHS will pay $117 million to resolve allegations that its facilities nationwide knowingly submitted false claims by billing Medicare, Medicaid, and other federal healthcare programs for inpatient behavioral health services that were not reasonable or medically necessary and/or failed to provide adequate and appropriate services for adults and children. Specifically, the allegations were that between January 2006 and December 2018, UHS’s facilities violated the law by:

  • Admitting Medicare, Medicaid, and other federal healthcare beneficiaries who were not eligible for inpatient or residential treatment because their conditions did not require that level of care;
  • Billing for services not rendered;
  • Billing for improper and excessive lengths of stay;
  • Failing to provide adequate staffing, training, and/or supervision of staff;
  • Improperly using physical and chemical restraints and seclusion;
  • Failing to develop and/or update individual assessments and treatment plans for patients;
  • Failing to provide adequate discharge planning;
  • Failing to provide required individual and group therapy services; and
  • Failing to properly discharge beneficiaries when they no longer required inpatient care.

Along with the settlement to pay $117 million, UHS entered into a five-year Corporate Integrity Agreement (“CIA”) with the U.S. Department of Health and Human Services, Office of Inspector General (“OIG”). As part of the CIA, UHS must hire an independent monitor, selected by the OIG, which will assess UHS’s Behavioral Health Division’s patient care protections as well as an independent review organization which will perform annual reviews of UHS’s inpatient behavioral health claims.

Berger Montague’s Whistleblower, Qui Tam & False Claims Act Practice Group has represented whistleblowers in matters involving healthcare fraud, defense contracting fraud, IRS fraud, securities fraud, commodities fraud, and federal grant fraud, helping to return more than $3 billion to federal and state governments. In return, whistleblower clients retaining Berger Montague to represent them in state and federal courts have received more than $500 million in rewards.

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