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51 hospitals pay $23 million, part of $280 million settlement in Medicare ICD probe

by Gail Kalinoski, Contributing Reporter | February 24, 2016
Cardiology Medical Devices Risk Management
With a $23 million settlement from 51 hospitals, the Department of Justice (DOJ)has reached the final stage of a nationwide investigation into hundreds of hospitals accused of improperly billing Medicare for cardiac devices implanted in violation of Medicare coverage requirements.

The investigation, which covered implantations done from 2003 to 2010, has now resulted in settlements with more than 500 hospitals totaling more than $280 million, according to the DOJ. In October, the department settled with 457 hospitals for more than $250 million.

“These settlements demonstrate the Department’s continued vigilance in pursuing hospitals and health systems that violate Medicare’s national coverage rules,” Benjamin C. Mizer, principal deputy assistant attorney general and head of the Justice Department’s Civil Division, said in a statement.

The allegations stemmed from a whistleblower lawsuit over implantable cardioverter defibrillators, or ICDs, implanted near and connected to the heart to treat fibrillations. The DOJ noted that Medicare coverage for an ICD, which costs about $25,000, is governed by a National Coverage Determination. The NCD stated ICDs generally should not be implanted in patients who recently had heart attacks, heart bypass surgery or angioplasty and established a 40- to 90-day waiting period before ICD procedures.

With a few exceptions, implantation during those waiting periods is prohibited — but the DOJ alleged the hospitals implanted ICDs during those waiting periods.

Wifredo A. Ferrer, U.S. Attorney of the Southern District of Florida said the settlements, “demonstrate the Department of Justice’s commitment to protect Medicare dollars and federal health benefits.” He stated the investigation was guided by a panel of “leading cardiologists and the review of thousands of patients’ charts” and was “heavily influenced by evidence-based medicine.”

Calling the legal action “one of the largest whistleblower lawsuits in the United States,” Ferrer said it resulted in one of the office’s most significant settlements.

However, the DOJ release noted “the claims resolved by these settlements are allegations only and there has been no determination of liability.”

The Cleveland Clinic Foundation, one of 11 health care systems in the recent settlement, called the procedures its doctors did “life-saving and life extending.” The clinic and six affiliated hospitals paid a total of $1.6 million.

In a statement to Cleveland.com, the clinic added: “Cleveland Clinic would provide the same treatment again if presented with the same illness. The only question was whether Medicare would reimburse part of the cost of the treatments. While we believe that the charges were appropriate, we chose to settle the matter rather than engaging in expensive litigation that distracts from our Mission.”

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