Universal Health Services and the Department of Justice announced a final settlement Friday to resolve claims stemming from 19 whistleblower lawsuits accusing the for-profit chain of providing unnecessary care and improperly luring patients to use its programs, among other allegations.
The for-profit hospital chain said the $122 million agreement, which follows years of investigation by the government, is largely consistent with the preliminary settlement announced one year ago.
"UHS is pleased to have resolved this matter to avoid future distractions and the high costs of litigation, while ensuring that our focus remains steadfast on providing excellent care to our patients and their families," the company said in a news release.
As part of the deal, UHS entered into a five-year corporate integrity agreement with the Department of Health and Human Services' Office of Inspector General. Among the agreement's requirements, the company will have to appoint a compliance officer. UHS will also have to create a compliance committee, chaired by the compliance officer, that will meet at least monthly with UHS' top behavioral health administrators to keep tabs on the care being provided.
The DOJ said the settlement resolves claims that UHS, UHS of Delaware and UHS' Turning Point Care Center in Moultrie, Ga., billed for medically unnecessary inpatient behavioral health services, failed to provide adequate and appropriate services and paid illegal inducements to federal healthcare beneficiaries. The DOJ had until now been tight-lipped about the nature of the allegations.
"Illegal inducements should never play a role in a patient's decision regarding treatment, especially when a patient is seeking care for addiction and other behavioral health needs," Byung Pak, U.S. attorney for the Northern District of Georgia, said in a statement. "Our office remains committed to pursuing unlawful arrangements that undermine the integrity of federal healthcare programs."
Between January 2006 and December 2018, the government says UHS' facilities admitted patients whose conditions did not require inpatient or residential treatment. The facilities also allegedly failed to discharge appropriately admitted patients who no longer needed inpatient care. The government also says UHS billed for services that weren't provided, billed for improper and excessive lengths of stay and failed to provide adequate staffing and training of staff.
With respect to Turning Point, the government found that between 2007 and 2019, the facility provided free or discounted airfare or bus tickets to encourage Medicare and Medicaid patients to seek treatment at its inpatient or outpatient programs.
After completing the inpatient program, the whistleblower complaint says Turning Point provided free or discounted lodging arrangements in furnished apartments to its Medicare beneficiary patients to wrongfully convince them to enroll in its outpatient program rather than receiving services in their home states. Federal law prohibits providers from offering free goods or services to induce Medicare patients to purchase or receive care through the federal healthcare program. The complaint says Turning Point also waived copays and deductibles to further convince patients to receive their services.
The complaint was filed by Mark Heatley, the facility's then-associate administrator, who said he discovered the practices shortly after he started working there in June 2017.
"Never in Mr. Heatley's 27 years in the industry has he seen a healthcare provider systematically offer inducements to lure and incentivize individuals to receive healthcare services at its facility," the complaint said. "The fraud is so rampant—and Turning Point so unrepentant—that Mr. Heatley decided to file this qui tam action."
Over 90% of Turning Point's revenue comes from Medicare, the complaint said. In fiscal 2017, the facility drew more than $5 million per month from the program.
UHS said the investigation related to facilities' compliance with complex and evolving state and federal policies regarding patient admission, discharge and treatment protocols. The company said many of the practices outlined in the qui tam cases occurred before UHS acquired the facilities.
"When UHS acquires a new facility, it rigorously assesses the operation and where needed, adjusts procedures to ensure compliance with proven protocols and high standards of care," the statement said.
UHS denied the allegations raised in the case and said the settlement does not constitute a finding of improper conduct.
The King of Prussia, Pa.-based company operates nearly 200 acute-care inpatient psychiatric hospitals and residential treatment facilities nationwide.
UHS said in July 2019 that the DOJ had closed its related criminal investigation into the company with no charges filed.
