CA Medical Biller to Pay $4.6M to Settle Fraud Allegations

An El Segundo, CA-based medical billing company has agreed to pay the federal government $4.6 million to settle fraud allegations stemming from overcharges at the company's Medicare and Medicaid operations in California and Louisiana, the Department of Justice said.

Federal prosecutors alleged that Janzen, Johnston & Rockwell Emergency Medicine Management Services Inc. inflated claims that it had coded on behalf of emergency room physicians in Louisiana and California.

From approximately 2000 through 2007, JJ&R used a coding formula that tended to generate claims for a marginally higher level of evaluation and management service than physicians had actually provided. JJ&R also routinely added charges to the evaluation and management claim for minor services, such as pulse oximetry, which had been provided by hospital nurses or physicians, DOJ said in a media release.  

All the while, JJ&R allegedly often failed to comply with Medicare's coding rules governing claims for teaching physicians, resulting in claims that were not properly payable. The coding practices had a relatively small impact on the reimbursement of any particular claim. Over time, however, they generated significant overpayments from Medicare and Medicaid, DOJ said.

"Inflating individual healthcare claims by even small amounts can cause significant losses to Medicare and Medicaid," Tony West, Assistant Attorney General for DOJ's Civil Division, said in a media release. "Taxpayers should not be on the hook for charges that shouldn't have been added or claims that shouldn't have been submitted." 

Attempts by HealthLeaders Media to contact JJ&R on Tuesday afternoon were not successful.

The settlement resolves whistleblower allegations brought by Le Jeanne Harris, a former employee of JJ&R, who will get $774,450.

DOJ said it has used the False Claims Act to recover more than $5.9 billion since January 2009 in cases involving fraud against federal healthcare programs.