Whistleblowers Often Play Key Roles in FCA Cases Alleging Inappropriate Inpatient Admission Cases

In April 2015, Medical Center of Central Georgia (MCCG) agreed to pay $20 million to the federal government to resolve a False Claims Act case alleging that it had submitted claims to Medicare for more expensive inpatient services that should have been billed as less costly observation services. Dozens of similar FCA settlements have occurred in the past five years, returning hundreds of millions of dollars to the federal government.

However, upon closer inspection, the MCCG recovery appears to be an outlier, for the government may have successfully pursued this case forward without the assistance of a qui tam relator.

The reality is that allegations of inappropriate hospital admissions are difficult to prove without the assistance of an insider-whistleblower. In turn, in the vast majority of the successful cases, the whistleblower is well placed in the hospital system. From this vantage point, they are best able to identify inpatient admissions that run afoul of medical necessity requirements. For example, in the recent $36 million FCA settlement with Dignity Health, the relator was the health system’s Health Director of Medical Management.

“Billing Medicare for higher cost inpatients services that patients do not need is a major strain on the public fisc,” explained former federal prosecutor and Nolan Auerbach & White partner Marcella Auerbach. “The False Claims Act provides substantial whistleblower rewards to incentivize people to step forward when they uncover such inpatient admission fraud.

More information for whistleblowers is located at the Nolan Auerbach & White website.

 

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