St. Josephs Healthcare System in New Jersey has agreed to pay the U.S. government $1.75 million to settle a whistle-blower lawsuit alleging the two-hospital system inflated its costs in order to get higher payments from Medicares outlier program from 2001 to 2003.
In the agreement, St. Josephs explicitly denies the alleged conduct and asserts that 500-bed St. Joseph Regional Medical Center in Paterson lawfully billed for the services at issue in accordance with prevailing statutory and regulatory requirements.
The lawsuit was filed in U.S. District Court in New Jersey in 2004 by healthcare consultant Anthony Kite against St. Josephs and several other healthcare providers, including 438-bed Cooper University Hospital, Camden, N.J., which reached a settlement agreement with the Justice Department in September and similarly denied any wrongdoing. The Justice Department chose not to join the case as it pertained to St. Josephs. Kite is set to receive $480,000 of the settlement sum under the False Claims Act, which invites whistle-blowers to sue on the governments behalf in exchange for a share of the money recovered. -- by Gregg Blesch