A Chicago hospital is the second institution nationwide to settle allegations that it tried to cheat Medicare by improperly filing claims for a severe and lucrative pneumonia diagnosis.
Louis A. Weiss Memorial Hospital, part of the University of Chicago Health System, paid $3.4 million to settle the matter and avert a long and costly trial.
The government alleged that 200-bed Weiss billed Medicare for the more severe bacterial pneumonia instead of the more common viral pneumonia from June 1993 to July 1997. Under Medicare, providers are reimbursed about $2,500 more per claim for bacterial pneumonia.
Government investigators found that the claims for bacterial pneumonia were not supported by the corresponding medical records Weiss kept. The records showed Weiss received more Medicare reimbursement money than it should have, the government alleged.
Weiss denied any wrongdoing and cooperated in the investigation, a statement from the U.S. Justice Department said.
HHS' inspector general's office included pneumonia upcoding in its work plan for fiscal 1999, which began Oct. 1. The nationwide pneumonia initiative first appeared in the inspector general's 1998 work plan. Both types of pneumonia accounted for more than $3.6 billion in Medicare billings in fiscal 1995, putting them among the top 10 most frequent Medicare discharges (Oct. 13, 1997, p. 12).
Crozer-Keystone Health System of Springfield, Pa., paid the only other known pneumonia settlement, a $664,500 fine, last year (Nov. 24, 1997, p. 6).
Meanwhile, Allegheny Health, Education and Research Foundation is under investigation for alleged pneumonia upcoding from October 1992 to September 1997 at its Philadelphia hospitals 195-bed City Avenue, 198-bed Graduate and 165-bed Parkview (Oct. 5, p.16). AHERF and federal investigators were poised to settle the case in early June, but the organization's bankruptcy filing threw a monkey wrench into negotiations. The case is ongoing.
Weiss officials said that the billings at issue in the case were submitted based on advice the hospital received from a physician who doubled as a billing consultant. Weiss officials thought this physician was an expert in examining medical charts to determine the appropriate charges to the federal health programs, the statement said. The hospital has severed its relationship with the physician and declined to name him.