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Oroville Hospital to Pay $10.25 Million to Resolve Allegations of Kickbacks and False Billing
SACRAMENTO, California — Oroville Hospital has agreed to pay $10.25 million to the United States and the State of California to resolve allegations that it violated the False Claims Act and the Anti-Kickback Statute, U.S. Attorney Phillip A. Talbert announced today.
Physicians should make decisions based the best interests of their patients, not their own personal financial interests, said U.S. Attorney Talbert. Hospitals engaging in kickback schemes betray the trust placed in them by their communities and distort care decisions that should be untainted by illegal kickbacks. This settlement demonstrates my office’s commitment to preserving the integrity of public healthcare programs and ensuring that the well-being of patients remains paramount.
According to the allegations, Oroville Hospital engaged in an illegal kickback and physician self-referral scheme by paying kickbacks to physicians for patients they admitted to the hospital, and that it knowingly submitted false claims to Medicare and Medi-Cal for medically unnecessary hospital admissions and claims that included false diagnosis codes.
Oroville Hospital will pay $9,518,954 to the federal government and $731,046 to the State of California. The settlement resolves allegations that, to increase hospital admissions, Oroville Hospital illegally paid kickbacks to its physicians who were responsible for deciding whether individuals should be admitted as inpatients.
These physicians allegedly received a bonus based on how many patients they admitted, according to the settlement agreement. The settlement also resolves allegations that Oroville Hospital admitted patients as inpatients when it knew inpatient care was not medically necessary. Oroville Hospital then submitted claims to Medicare and Medicaid for inpatient care, which is more expensive.
In connection with the settlement, Oroville Hospital entered into a five-year Corporate Integrity Agreement with the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) that requires, among other requirements, the implementation of a risk assessment and internal review process designed to identify and address evolving compliance risks.
Cecilia Guardiola, a whistleblower, brought the allegations under the qui tam or whistleblower provisions of the False Claims Act. Under those provisions, a private party can file an action on behalf of the United States and receive a portion of any recovery. Ms. Guardiola will receive approximately $1.8 million as part of the settlement.
Key Facts
- State: California
- Category: White Collar Crime|Fraud & Financial Crimes
- Source: DOJ Press Release â†â€â€
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