Healthcare Business News

Community Health Systems to pay $97 million settlement

By Bob Herman
Posted: August 9, 2014 - 12:01 am ET

Community Health Systems has agreed to pay more than $97 million plus interest to the federal government to settle allegations that it submitted false claims for short-stay admissions that should have been billed as outpatient charges.

The settlement, announced by CHS and the Justice Department last week, came with no finding of improper conduct by CHS or its hospitals, and CHS has denied any wrongdoing, the Franklin, Tenn.-based system said.

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At issue were billing practices of 119 CHS hospitals between January 2005 and December 2010. Several whistle-blowers alleged CHS admitted patients through its emergency departments and then billed Medicare, Medicaid and the military's Tricare for “medically unnecessary” inpatient stays or procedures, when patients should have been treated as outpatients or placed on observation. The whistle-blowers also said CHS had set certain admissions benchmarks to improve profitability.

The settlement also resolved separate allegations of inappropriate cardiac and hemodialysis services and self-referrals at CHS' Laredo (Texas) Medical Center.

Wayne Smith, CEO of CHS, said his company hopes to work more closely with the government to determine what constitutes appropriate inpatient care, because “shifting and often ambiguous standards make it extremely difficult for physicians and hospitals to consistently comply with the regulations,” he said.

Follow Bob Herman on Twitter: @MHbherman

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