Shands HealthCare, located in Florida and connected with the University of Florida’s College of Medicine, will reportedly pay over $26 million in fines and penalties to the United States government pursuant to its recent settlement of claims under the False Claims Act. Shands is comprised of six prominent hospitals in the Central and Northeast Florida areas, including Shands at Jacksonville; Shands at Gainesville, also known as Shands at the University of Florida; Shands Alachua General Hospital; Shands at Lakeshore; Shands Starke and Shands Live Oak. In its original whistleblower complaint, filed by whistleblower Terry Myers on behalf of the United States, Shands is alleged to have submitted false claims to Medicare, Medicaid and other federal healthcare programs. Specifically, the healthcare group routinely billed federal agencies for inpatient services that should have been categorized as outpatient.
U.S. Deputy Attorney General Speaks Out Against Fraud
In its investigation, officers from the U.S. Attorney’s Office for the Middle District of Florida, the Commercial Litigation Branch of the Justice Department’s Civil Division, the Department of Health and Human Services’ Office of Inspector General and Office of Counsel to the Inspector General, and the Florida Attorney General’s Office worked as a team to reveal that Shands officials in all six hospitals were billing higher inpatient rates for procedures each should of known were outpatient in nature. Outpatient procedures are those not requiring an overnight hospital stay and generally impose a much shorter recovery time, as opposed to inpatient procedures which can result in days, weeks or even months under a doctor’s constant supervision. According to the Centers for Medicare and Medicaid Services, the most commonly billed inpatient services include placement on a ventilator, joint replacement, heart failure and pulmonary episodes (e.g., asthma attacks or pneumonia).
Whistleblower to Reap Large Reward for Coming Forward
The whistleblower in this case is the current president of healthcare consulting firm YPRO located in Jacksonville, Florida. While his reward as the relator is not immediately apparent from the settlement agreement, most qui tam plaintiffs earn awards close to 20 percent of the actual settlement amount. In this case, Shands agreed to pay $25,170,400.00 to the federal government as well as an addition $829,600.00 to the State of Florida. Both amounts are subject to interest charges beginning in December, 2012. As always, the settlement agreement clearly states that Shands is not actually admitting any liability in this matter.
Assistant U.S. Attorney General for the Civil Division Stuart F. Delery recently commented on the scandal by stating:
“The Department of Justice is committed to ensuring that Medicare funds are expended appropriately, based on the medical needs of patients rather than the desire of health care providers to maximize profits….Hospitals participating in Medicare must bill for their services accurately and honestly.”
Serving as a Whistleblower Protects Taxpayers on State and Federal Levels
Many whistleblower lawsuits are handled by both state and federal governments, notwithstanding the fact that it is usually the United States government named as the plaintiff. This is because when a healthcare facility, business or other government contractor is found to be engaging in fraudulent conduct, it often involves the theft of both state and federal funds. Serving as a whistleblower not only protects the federal funding needed for programs and national administration, but reserves state funding as well – meaning, you are serving both your nation and your state by stepping forward against deceit and greed.
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