Some of biggest COVID payments go to providers who've paid large settlements
Skip to main content
MDHC_Logotype_white
Subscribe
  • My Account
  • Login
  • Subscribe
  • News
    • This Week's News
    • COVID-19
    • Providers
    • Insurance
    • Government
    • Finance
    • Technology
    • Safety & Quality
    • People
    • Regional News
    • Digital Edition
    • Merck ends development of two potential COVID-19 vaccines
      Ascension’s St. Mary’s Hospital Surgery Center at Towne Centre and Allegheny Health Network’s Bethel Park surgery center
      Hospitals see opportunity, risk in ambulatory surgery centers
      Ambulatory surgery centers offer extraordinary value in a high-cost healthcare system
      KPMG says deal activity will stay high in '21: 10 takeaways
    • Merck ends development of two potential COVID-19 vaccines
      KPMG says deal activity will stay high in '21: 10 takeaways
      2 in 5 Americans live where COVID-19 strains hospital ICUs
      Biden's early approach to virus: Underpromise, overdeliver
    • Ascension’s St. Mary’s Hospital Surgery Center at Towne Centre and Allegheny Health Network’s Bethel Park surgery center
      Hospitals see opportunity, risk in ambulatory surgery centers
      Health suffers as rural hospitals close
      Medicare ACO participants fell in 2021
      Louisiana gets reports vaccine providers are discriminating
    • Last-minute COVID costs cut into UnitedHealthcare's $396 million operating income
      CMS approves rule forcing insurers to ease prior authorization
      COVID-19 still a big uncertainty for insurers in 2021
      Health insurers' outlook boosted after Dems' Georgia win
    • It's a secret: California keeps key virus data from public
      lacewell_linda_supertinendent_dept_of_financial_services_8.47.jpg
      New York state investigates drug price spikes during pandemic
      Health experts blame rapid expansion for vaccine shortages
      HHS freezes rule targeting community health centers' drug discounts
    • KPMG says deal activity will stay high in '21: 10 takeaways
      By the Numbers: 20 largest healthcare investment banks in 2020
      Providers await new HHS coronavirus grant reporting deadline
      Operation Warp Speed Dr. Moncef Slaoui, Pfizer Group President Angela Hwang, Moderna CEO Stephane Bancel, CVS Health Executive Vice President Karen Lynch and McKesson CEO Brian Tyler participate in a panel discussion on the COVID-19 vaccine.
      Hospitals, drug companies strive to stand out virtually at JPM
    • Dr. Karen DeSalvo
      Next Up Podcast: What to expect with telehealth and healthcare technology in the next 4 years
      Next Up Podcast: What to expect with telehealth and healthcare technology in the next 4 years - Transcript
      A man in a room with servers.
      Momentum grows to outsource hospital tech functions in 2021
      5 things to know about Google's $2.1B Fitbit acquisition
    • Avocado
      Avocado a day keeps the doctor away
      50% of Americans make resolutions. Fewer than 27% keep them over time.
      Data Points: Sticking with your resolutions
      An older man wearing a mask receiving a vaccine.
      Want more diversity in clinical trials? Start with the researchers
      U.K. chief scientist says new virus variant may be more deadly
    • Cerner names Erceg as new CFO
      Elizabeth Richter will serve as acting CMS administrator
      Providence names new chief financial officer
      Wisconsin's top health official departing for federal job
    • Midwest
    • Northeast
    • South
    • West
  • Insights
    • ACA 10 Years After
    • Best Practices
    • InDepth Special Reports
    • Innovations
    • The Affordable Care Act after 10 years
    • New care model helps primary-care practices treat obesity
      doctor with patient
      COVID-19 treatment protocol developed in the field helps patients recover
      Rachel Wyatt
      Project to curb pressure injuries in hospitals shows promise
      Yale New Haven's COVID-19 nurse-staffing model has long-term benefits
    • Modern Healthcare InDepth: Breaking the bias that impedes better healthcare
      Videos: Healthcare industry executives describe their encounters with racism
      Michellene Davis
      Healthcare leadership lacks the racial diversity needed to reduce health disparities
      Dr. James Hildreth
      How medical education can help fight racism
      Quotes from rebadged employees
      Outsourcing IT, revenue cycle takes toll on internal culture
    • A phone screen showing the question, "Mary we hope this information was helpful and we'd like to keep guiding you. Are you interested in knowing when it's your turn to receive the vaccine?"
      Chatbots, texting campaigns help manage influx of COVID vax questions
      A woman with a wearable sensor talking to her provider.
      Wearable sensors help diagnose heart rhythm problems in West Virginia
      self service station
      COVID-19 pushes patient expectations toward self-service
      Targeting high-risk cancer patients with genetics
  • Transformation
    • Patients
    • Operations
    • Care Delivery
    • Payment
    • Highmark Health inks six-year cloud, tech deal with Google
      Study: 1 in 5 patients report discrimination when getting healthcare
      HHS proposes changing HIPAA privacy rules
      Android health records app launches at 230 health systems
    • California hospitals prepare ethical protocol to prioritize lifesaving care
      Amazon, JPMorgan Chase, Berkshire Hathaway disband Haven
      Digital pathways poised to reshape healthcare continuum in 2021
      Healthcare was the hardest hit by supply shortages across all U.S. industries
    • A phone screen showing the question, "Mary we hope this information was helpful and we'd like to keep guiding you. Are you interested in knowing when it's your turn to receive the vaccine?"
      Chatbots, texting campaigns help manage influx of COVID vax questions
      A woman with a wearable sensor talking to her provider.
      Wearable sensors help diagnose heart rhythm problems in West Virginia
      New care model helps primary-care practices treat obesity
      How hospitals are building on COVID-19 telehealth momentum
    • Regional insurers bet big on virtual-first plans
      MedPAC votes to boost hospital payments, freeze or cut other providers
      Most Next Gen ACOs achieved bonuses in 2019
      Congress recalibrates Medicare Physician Fee Schedule after lobbying
  • Data/Lists
    • Rankings/Lists
    • Interactive Databases
    • Data Points
    • Health Systems Financials
      Executive Compensation
      Physician Compensation
  • Op-Ed
    • Bold Moves
    • Breaking Bias
    • Commentaries
    • Letters
    • Vital Signs Blog
    • From the Editor
    • Wellstar CEO calls adapting for the pandemic her bold move
      Howard P. Kern
      Recognizing the value of telehealth in its infancy
      Dr. Stephen Markovich
      A bold move helped take him from family doctor to OhioHealth CEO
      Dr. Bruce Siegel
      Why taking a hospital not-for-profit was Dr. Bruce Siegel’s boldest move
    • Barry Ostrowsky
      Ending racism is a journey taken together; the starting point must be now
      Laura Lee Hall and Gary Puckrein
      Increased flu vaccination has never been more important for communities of color
      John Daniels Jr.
      Health equity: Making the journey from buzzword to reality
      Mark C. Clement and David Cook
      We all need to 'do something' to fight inequities and get healthcare right, for every patient, every time
    • Ambulatory surgery centers offer extraordinary value in a high-cost healthcare system
       Alan B. Miller
      Looking ahead with optimism as we continue to transform healthcare
      Dr. Bruce Siegel
      By protecting the healthcare safety net, Biden can put us on the path to a stronger country
      Healing healthcare: some ideas for triage by the new Congress, administration
    • Letters: Eliminating bias in healthcare needs to be ‘deliberate and organic’
      Letters: Maybe dropping out of ACOs is a good thing for patients
      Letters: White House and Congress share blame for lack of national COVID strategy
      Letters: VA making strides to improve state veterans home inspections
    • Sponsored Content Provided By Optum
      How blockchain could ease frustration with the payment process
      Sponsored Content Provided By Optum
      Three steps to better data-sharing for payer and provider CIOs
      Sponsored Content Provided By Optum
      Reduce total cost of care: 6 reasons why providers and payers should tackle the challenge together
      Sponsored Content Provided By Optum
      Why CIOs went from back-office operators to mission-critical innovators
  • Awards
    • Award Programs
    • Nominate
    • Previous Award Programs
    • Other Award Programs
    • Best Places to Work in Healthcare Logo for Navigation
      Nominations Open - Best Places to Work in Healthcare
      Nominations Open - Health Care Hall of Fame
      Nominations Open - 50 Most Influential Clinical Executives
    • 100 Most Influential People
    • 50 Most Influential Clinical Executives
    • Best Places to Work in Healthcare
    • Health Care Hall of Fame
    • Healthcare Marketing Impact Awards
    • Top 25 Emerging Leaders
    • Top 25 Innovators
    • Top 25 Minority Leaders
    • Top 25 Women Leaders
    • Excellence in Nursing Awards
    • Design Awards
    • Top 25 COOs in Healthcare
    • 100 Top Hospitals
    • ACHE Awards
  • Events
    • Conferences
    • Galas
    • Webinars
    • COVID-19 Event Tracker
    • Leadership Symposium
    • Healthcare Transformation Summit
    • Women Leaders in Healthcare Conference
    • Workplace of the Future Conference
    • Strategic Marketing Conference
    • Social Determinants of Health Symposium
    • Best Places to Work Awards Gala
    • Health Care Hall of Fame Gala
    • Top 25 Minority Leaders Gala (2022)
    • Top 25 Women Leaders Gala
  • Listen
    • Podcast - Next Up
    • Podcast - Beyond the Byline
    • Sponsored Podcast - Healthcare Insider
    • Video Series - The Check Up
    • Sponsored Video Series - One on One
    • Dr. Karen DeSalvo
      Next Up Podcast: What to expect with telehealth and healthcare technology in the next 4 years
      Carter Dredge
      Next Up Podcast: Ready, set, innovate! Innovation and disruption in healthcare
      Next Up Podcast: COVID-19, social determinants highlight health inequities — what next?
      Next Up Podcast: Saving Rural Health
    • Beyond the Byline: Regulators aim to boost value push with fraud and abuse law updates
      An older man wearing a mask receiving a vaccine.
      Beyond the Byline: Verifying information on the chaotic COVID-19 vaccine rollout
      doctor burnout
      Beyond the Byline: How healthcare supply chain struggles contribute to employee burnout
      Beyond the Byline: Covering race and diversity in the healthcare industry
    • Leading intention promote diversity and inclusion
      Introducing Healthcare Insider Podcast
    • The Check Up: Chip Kahn
      The Check Up: Chip Kahn of the Federation of American Hospitals
      The Check Up: Trenda Ray
      The Check Up: Trenda Ray of the University of Arkansas for Medical Sciences
      The Check Up: Dr. Kenneth Davis
      The Check Up: Dr. Kenneth Davis of Mount Sinai Health System
      The Check Up: Dr. Thomas McGinn
      The Check Up: Dr. Thomas McGinn of CommonSpirit Health
    • Video: Ivana Naeymi Rad of Intelligent Medical Objects
  • MORE +
    • Advertise
    • Media Kit
    • Newsletters
    • Jobs
    • People on the Move
    • Reprints & Licensing
MENU
Breadcrumb
  1. Home
  2. Providers
May 11, 2020 10:45 AM

Some of biggest COVID payments go to providers who've paid large settlements

Rachana Pradhan and Fred Schulte, Kaiser Health News
  • Tweet
  • Share
  • Share
  • Email
  • More
    Print
    Shutterstock / Lukiyanova Natalia / frenta

    The Trump administration has sent hundreds of millions of dollars in pandemic-related bailouts to healthcare providers with checkered histories, including a Florida-based cancer center that agreed to pay a $100 million criminal penalty as part of a federal antitrust investigation.

    At least half of the top 10 recipients, part of a group that received $20 billion in emergency funding from HHS, have paid millions in recent years either in criminal penalties or to settle allegations related to improper billing and other practices, a Kaiser Health News review of government records shows.

    They include Florida Cancer Specialists & Research Institute, one of the nation's largest U.S. oncology practices, which in late April said it would pay a $100 million penalty for engaging in a nearly two-decade-long antitrust scheme to suppress competition. A top Justice Department lawyer described the plot as "limiting treatment options available to cancer patients in order to line their pockets." The company, which is required to pay the first $40 million in penalties by June 1, received more than $67 million in HHS bailout funds.

    HHS distributed emergency funding to hospitals and other providers to help offset revenue losses or expenses related to COVID-19. In April, it distributed the first $50 billion based on providers' net patient revenue, a calculation that gives more money to bigger systems or institutions charging higher prices.

    Companies that have attested to receiving payments as of May 4 collectively received roughly $20 billion. The list is likely to change in the coming days as other companies confirm they've received money.

    In total, the CARES Act, signed into law by President Donald Trump in March, provides $100 billion in emergency funding. Subsequent coronavirus relief legislation added another $75 billion. Money has also been steered to hot spots with high numbers of COVID-19 patients, rural health care providers and the Indian Health Service.

    Of the companies documented to date, other top recipients ― including Dignity Health in Phoenix, the Cleveland Clinic, Houston's Memorial Hermann Health System and Massachusetts General Hospital in Boston — have paid millions in recent years to resolve allegations related to improper billing in federal health programs, false claims to increase their payments or lax oversight that enabled employees to steal prescription painkillers.

    Dignity Health, one of the largest hospital systems in the West, received $180.3 million in HHS bailout funds, making it the top recipient listed. It has settled civil accusations by DOJ that it submitted false claims to Medicare and TriCare, the military health care program.

    The Cleveland Clinic, which in 2015 paid $1.74 million to settle federal allegations that it mischarged Medicare for costly spinal procedures to increase their billings and has entered into other similar settlements, received $103.3 million from HHS, the second-largest amount.

    Memorial Hermann Health System and Massachusetts General Hospital received more than $93 million and $58 million, respectively. In 2018, Memorial Hermann paid nearly $2 million to the government to settle allegations that it improperly billed government health care programs by charging for higher-cost services when patients only needed lower-cost outpatient services.

    Massachusetts General Hospital in 2015 paid the federal government $2.3 million to settle allegations that lax oversight enabled hospital employees to steal thousands of prescription medications, mostly addictive painkillers, for personal use.

    Malcolm Sparrow, a professor at the Harvard John F. Kennedy School of Government, said the HHS methodology for its general distribution of relief funds is "a little bit worrying."

    "If you peg the amount based on historical volume and you've got good reason to believe that historical volume is inflated due to fraud and abuse, the irony is that they get more money because they're more dishonest," Sparrow said. "But you can't prove that in a short period of time."

    Public tolerance for fraud and abuse naturally rises during times of emergency, Sparrow said, and now is not the time to revisit historical decisions to determine which companies are entitled to federal relief based on legal issues.

    "I think that's a tough case to make," he said.

    HHS has criteria for disqualifying providers from receiving bailout money. But even the strongest condition carries a broad caveat: None of the funds may be used for grants to any corporation convicted of a felony criminal violation within the preceding two years ― unless officials have decided that it is not necessary to prohibit them from doing business with the federal government.

    "It's sort of a high bar" for someone to be disqualified for this money, said Roger Cohen, a health care lawyer at Goodwin who specializes in fraud and anti-kickback law.

    The Florida oncology provider has been charged with a felony and admitted to an antitrust crime, however federal prosecutors agreed to defer any prosecution and trial because a criminal conviction would have "significant collateral consequences" for its patients, the DOJ said.

    Beyond that, HHS in its terms states that providers have to certify that they are not excluded from participating in federal health care programs like Medicare and Medicaid and have not had their Medicare billing privileges revoked.

    The HHS Inspector General has the authority to exclude practitioners and health care companies for a wide variety of reasons — including a conviction of fraud ― but it's highly unusual for the federal government to do so with large institutions, experts say.

    "I imagine there would be hesitancy to exclude the provider," Cohen said. "I think you'd have concerns about interrupting access to care."

    An HHS spokesperson declined to comment on its existing allocations but said the department has rules in place to recoup funds and address fraudulent activity if necessary.

    "Failure to comply with any term or condition is grounds for HHS to recoup some or all of the payment from the provider," the spokesperson said.

    In a statement, Florida Cancer Specialists signaled it intended to use the funding.

    "During this health crisis, we have continued to keep the doors of our more than 80 facilities open to ensure that cancer patients have access to care and treatment," Thomas Clark, the company's chief legal officer, wrote in an email. "We plan to use these funds, if needed, in accordance with government guidelines to continue providing affordable, safe and high-quality cancer care."

    Dignity Health said, "We have had to bear significant costs to prepare for and manage the pandemic in our communities even as patient volumes have been dramatically reduced across our hospitals."

    In October 2014, Dignity agreed to pay $37 million after the Department of Justice alleged it admitted patients to 13 of its hospitals in California, Nevada and Arizona who could have been treated on a "less costly, outpatient basis." The civil case involved patients treated for elective heart procedures, such as pacemakers and stents, and other conditions. The company did not acknowledge wrongdoing in settling the case.

    "Charging the government for higher-cost inpatient services that patients do not need wastes the country's vital health care dollars," acting Assistant Attorney General Joyce Branda for the Justice Department's Civil Division said at the time. "This department will continue its work to stop abuses of the nation's health care resources and to ensure patients receive the most appropriate care."

    Dignity said that independent annual audits were conducted after the False Claims Act settlement in 2014 and "no additional concerns were raised related to this issue."

    Massachusetts General Hospital and Memorial Hermann did not respond to requests for comment. The Cleveland Clinic confirmed the amount of money received from HHS but declined to comment further.

    Kaiser Health News is a national health policy news service. It is an editorially independent program of the Henry J. Kaiser Family Foundation which is not affiliated with Kaiser Permanente.

    Letter
    to the
    Editor

    Send us a letter

    Have an opinion about this story? Click here to submit a Letter to the Editor, and we may publish it in print.

    Recommended for You
    Hospitals see opportunity, risk in ambulatory surgery centers
    Hospitals see opportunity, risk in ambulatory surgery centers
    Health suffers as rural hospitals close
    Health suffers as rural hospitals close
    Sponsored Content
    Get Free Newsletters

    Sign up for free enewsletters and alerts to receive breaking news and in-depth coverage of healthcare events and trends, as they happen, right to your inbox.

    Subscribe Today

    The weekly magazine, websites, research and databases provide a powerful and all-encompassing industry presence. We help you make informed business decisions and lead your organizations to success.

    Subscribe
    Connect with Us
    • LinkedIn
    • Twitter
    • Facebook
    • RSS
    • Instagram

    Stay Connected

    Join the conversation with Modern Healthcare through our social media pages

    MDHC_Logotype_white
    Contact Us

    (877) 812-1581

    Email us

     

    Resources
    • Contact Us
    • Advertise with Us
    • Ad Choices Ad Choices
    • Sitemap
    Editorial Dept
    • Submission Guidelines
    • Code of Ethics
    • Awards
    • About Us
    Legal
    • Terms and Conditions
    • Privacy Policy
    • Privacy Request
    Modern Healthcare
    Copyright © 1996-2021. Crain Communications, Inc. All Rights Reserved.
    • News
      • This Week's News
      • COVID-19
      • Providers
      • Insurance
      • Government
      • Finance
      • Technology
      • Safety & Quality
      • People
      • Regional News
        • Midwest
        • Northeast
        • South
        • West
      • Digital Edition
    • Insights
      • ACA 10 Years After
      • Best Practices
      • InDepth Special Reports
      • Innovations
    • Transformation
      • Patients
      • Operations
      • Care Delivery
      • Payment
    • Data/Lists
      • Rankings/Lists
      • Interactive Databases
      • Data Points
    • Op-Ed
      • Bold Moves
      • Breaking Bias
      • Commentaries
      • Letters
      • Vital Signs Blog
      • From the Editor
    • Awards
      • Award Programs
        • 100 Most Influential People
        • 50 Most Influential Clinical Executives
        • Best Places to Work in Healthcare
        • Health Care Hall of Fame
        • Healthcare Marketing Impact Awards
        • Top 25 Emerging Leaders
        • Top 25 Innovators
        • Top 25 Minority Leaders
        • Top 25 Women Leaders
      • Nominate
      • Previous Award Programs
        • Excellence in Nursing Awards
        • Design Awards
        • Top 25 COOs in Healthcare
      • Other Award Programs
        • 100 Top Hospitals
        • ACHE Awards
    • Events
      • Conferences
        • Leadership Symposium
        • Healthcare Transformation Summit
        • Women Leaders in Healthcare Conference
        • Workplace of the Future Conference
        • Strategic Marketing Conference
        • Social Determinants of Health Symposium
      • Galas
        • Best Places to Work Awards Gala
        • Health Care Hall of Fame Gala
        • Top 25 Minority Leaders Gala (2022)
        • Top 25 Women Leaders Gala
      • Webinars
      • COVID-19 Event Tracker
    • Listen
      • Podcast - Next Up
      • Podcast - Beyond the Byline
      • Sponsored Podcast - Healthcare Insider
      • Video Series - The Check Up
      • Sponsored Video Series - One on One
    • MORE +
      • Advertise
      • Media Kit
      • Newsletters
      • Jobs
      • People on the Move
      • Reprints & Licensing