According to the Department of Justice, nine hospitals in seven states have agreed to pay $9.4 million, collectively, to settle claims that the hospitals falsely billed the United States for kyphoplasty, a minimally-invasive procedure used to treat spinal fractures related to osteoperosis. The Government contends that the hospitals admitted patients for in-patient procedures when the procedures could have been more safely, effectively, and economically performed on an out-patient basis. These agreements follow the May, 2008 settlement between the U.S. and Medtronic Spine, LLC, successor in interest to Kyphon, Inc. and the September, 2009 settlements of nine other hospitals. Whistleblowers Craig Patrick and Charles Bates, who instituted an action against the hospitals in 2008 under the qui tam provisions of the False Claims Act, will receive $1.5 million from the most recent settlement.
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[…] Craig Patrick and Charles Bates — former employees of spinal medical equipment giant Kyphon — blew the whistle on Rex Healthcare for improperly billing Medicare for out-patient surgeries as in-patient procedures. Raleigh, N.C. based Rex Healthcare will pay $1.9 million, plus interest, to settle allegations that it submitted false claims for such minimally-invasive procedures as Kyphoplasty. (To see an animation of a kyphoplasty procedure, click here.) According to DoJ, Rex Healthcare “routinely submitted claims to Medicare for a variety of minimally-invasive procedures during the period 2004 through 2007, which the hospital classified as inpatient admissions in order to increase its reimbursement from Medicare, despite the absence of medical necessity justifying the more expensive inpatient admissions.” FraudBlawg has previously reported similar qui tam settlements here and here. […]