Dignity Health Pays $37 Million after Alleged FCA Violations

Dignity Health recently agreed to pay approximately $37 million to the United States in a Fair Claims Act violation settlement. According to the allegations against Dignity Health, a hospital system based in San Francisco (and one of the five largest hospital systems in America), 13 of its hospitals throughout California, Arizona and Nevada were guilty of knowingly filing false claims to TRICARE and Medicare by admitting patients that could have received less expensive outpatient treatment.


The patients were overcharged through Medicare and TRICARE for these inpatient services, particularly those patients that elected to undergo certain cardiovascular procedures (like pacemakers and stents). In these cases, the claims should have been listed and billed as outpatient surgeries.


Four of the hospitals in the Dignity Health system were also accused of billing Medicare for elective kyphoplasty procedures, minimally invasive procedures that should have been billed as outpatient procedures, which would have made them less expensive. Another allegation by the government claimed that 13 hospitals between 2006 and 2010 had admitted patients for common medical diagnoses where it was unnecessary to bring the patient in for inpatient care as opposed to observation or outpatient treatment.


In addition to the payment Dignity Health will make in the settlement, it also agreed with the United States Department of Health to be subject to closer supervision of its FCA compliance efforts within the next five years. Dignity will now be required to retain the services of independent organizations to review the company’s claims for services.


If you are an employee in the health care industry and you become aware of wrongdoing within your organization, speak with the skilled Dallas attorneys at Whistleblower Law for Managers for more information on your legal options.