A Charlottesville, Va.-based faculty practice plan of the University of Virginia has agreed to pay an $8.6 million fine after discovering Medicare billing irregularities in a self audit two years ago and turning itself in.
The settlement with the University of Virginia Health Services Foundation, a 480-physician group, is the third in the federal government's 2-year-old fraud investigation of Medicare billing practices by teaching hospitals and their doctors.
The physicians practice at the 604-bed University of Virginia Medical Center in Charlottesville.
The settlement comes just weeks after a cadre of healthcare trade groups and universities sued HHS in federal court to temper the government probe, called "Physicians at Teaching Hospitals" or PATH (Nov. 3, p. 4).
Recoveries from the investigation now total more than $50 million.
The Virginia teaching physician group came to the attention of federal regulators two years ago after it did a self audit and reported its billing problems to the U.S. attorney's office in Alexandria, Va. In a statement, local U.S. attorney Helen Fahey praised the group's self-disclosure.
The teaching foundation admitted no liability in the Nov. 14 settlement. Besides the fine, the settlement requires a compliance program.
Alerting federal regulators to the billing irregularities was keeping with tradition at the University of Virginia, said William E. Carter Jr., executive director of the teaching foundation. "We talk about honor and integrity here a lot; it's part of the heritage of the place," Carter said. "I guess I feel if we mean that we should do what we did."
Carter said the settlement covers from 1991 to 1996. According to the U.S. attorney's office, billing problems included a lack of documentation to show teaching physicians were involved sufficiently in cases handled by residents and interns to warrant additional bills for their work. Carter said human error was a factor in the bills. Under Medicare rules, teaching physicians can bill for services they actually provide or those that are provided by students under their direction.The audit didn't turn up bills for work performed when a teaching physician wasn't present, Carter said.
Not all PATH investigations have found billing irregularities. HHS has cleared two hospitals of wrongdoing and an additional 16 queries were dropped this summer because Medicare carriers gave unclear instructions. About 50 audits are ongoing.