Christus Settles Medicare Fraud Charges for Nearly $1M

Houston-based Christus Health Systems will pay the federal government nearly $971,000 to settle whistleblower allegations that several of its hospitals in Texas and Louisiana fraudulently billed Medicare for ineligible costs and expenses and failed to disclose overpayments.

The settlement by Christus, which operates more than 40 hospitals and facilities in eight states, resolves a whistleblower's lawsuit that alleged fraudulent Medicare billings as far back as 1988 while others occurred as recently as 2001. The lawsuit had been under seal until this month, when a federal district court judge in Los Angeles unsealed the case.

The hospitals involved in the settlement include St. Mary's Galveston Hospital in Galveston, Texas; St. Michael's Health System in Texarkana, Texas; Christus Hospital—St. Elizabeth in Beaumont, TX; Christus Hospital—St. Mary in Port Arthur, TX; Christus Schumpert Health System in Shreveport, LA; Christus St. Frances Cabrini Hospital in Alexandria, LA; and Christus St. John Hospital in Nassau Bay, TX.

Christus Health paid the settlement without admitting any wrongdoing.

The whistleblower lawsuit was filed in 1998 by Mark Razin, a former employee of Healthcare Financial Advisors, a California-based consulting firm that helped hospitals prepare cost reports that were submitted to Medicare/Medicaid. The lawsuit alleged that HFA helped hospitals seek reimbursement for unallowable costs and helped conceal known overpayments from the government, federal prosecutors said.

HFA also allegedly helped hospitals reopen previously filed cost reports to seek reimbursement for costs that it had inadvertently failed to claim in its original cost reports, while simultaneously concealing from Medicare overpayments the hospitals knew they had received on account of the original cost reports, federal prosecutors said.

The settlement with Christus is the latest and last in a series of settlements with nine hospital defendants in the whistleblower suit that have cumulatively paid approximately $61 million to the federal government, including: a 2007 settlement in which the Loma Linda Behavioral Medicine Center in Redlands, CA, paid more than $2 million; and the 2006 settlement in which Jackson Memorial Hospital in Miami, FL, paid $14.25 million.

The settlement was negotiated by the United States Attorney's Office in Los Angeles.

See also:

New Medicare Fraud and Abuse Provisions Under the PPACA

Physician to Settle Medicare Fraud Case for $20M