For the first time in recent memory, HHS' inspector general's office made a public announcement that a healthcare provider wasn't in trouble.
Last week, the agency said an investigation of the prestigious Dartmouth-Hitchcock Medical Center in Lebanon, N.H., turned up no pattern of Medicare billing irregularities and the hospital wouldn't be subject to any civil monetary penalty.
The unusual move by the agency is widely viewed as a public relations gesture to placate teaching hospitals and their faculty practice plans, which have been pressuring federal lawmakers to put the brakes on the agency's ongoing billing investigation.
The investigation, which began in fall 1995, focuses on how those providers bill Medicare for the work done by medical residents. To date, the investigation has resulted in two multimillion-dollar settlements with two hospitals and their physicians.
But recently, the agency has been telling lawmakers that the investigation of teaching hospitals has uncovered widespread billing problems that go well beyond the initial scope of the probe.
The inspector general's office has said it has found a pattern of DRG "upcoding" at teaching hospitals that artificially inflates their Medicare reimbursement rates.
A spokeswoman for the agency said federal investigators did find some cases where Medicare bills were overstated by Dartmouth-Hitchcock, but those bills were offset by cases in which bills were understated.
In response to the agency clearing Dartmouth-Hitchcock, the Association of American Medical Colleges said the "wide variation in . . . settlements secured to date, in and of themselves, illustrate the ambiguity and confusion that existed in the earlier (billing) guidelines."
Some hospital lobbyists say Dartmouth-Hitchcock's clearance will be used by the inspector general's office to show Congress that it isn't on a witch hunt.
"They don't want to look like zealots, so they wanted a case where they found nothing," said one lobbyist who asked not to be identified.