University of Miami to Pay $22 Million to Settle Claims Involving Medically Unnecessary Laboratory Tests and Fraudulent Billing Practices
(STL.News) The University of Miami (UM) has agreed to pay $22 million to resolve allegations that it violated the False Claims Act by ordering medically unnecessary laboratory tests, and submitting false claims through its laboratory and off campus hospital based facilities (“Hospital Facilities”).
According to court documents, the United States alleged that UM engaged in three practices that violated the False Claims Act. First, the government alleged that UM knowingly engaged in improper billing relating to its Hospital Facilities. Medicare regulations allow medical systems to convert physician offices into Hospital Facilities provided they satisfy certain requirements. Billing as a Hospital Facility results in higher costs to the Medicare program and beneficiaries. Hospital Facilities are required to give notice to Medicare beneficiaries that explains the financial ramifications of receiving services at Hospital Facilities as opposed to physician offices. Here, the government alleged that UM converted multiple physician offices to Hospital Facilities, and then sought payment at higher rates without providing beneficiaries the required notice, even after being advised by a Medicare Administrative Contractor that its notice practices were deficient.
Second, the government alleged that UM billed federal health care programs for medically unnecessary laboratory tests for patients who received kidney transplants at the Miami Transplant Institute (MTI) — a transplant program operated by UM and Jackson Memorial Hospital (JMH).