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U.S. settles allegations against hospitals, ambulance company

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JACKSONVILLE, Fla. – Allegations that nine hospitals in Jacksonville had a practice of routinely ordering basic life support ambulances when this type of transport was not medically necessary have been settled, the U.S. Attorney's Office announced Friday.

The United States has also settled allegations with an ambulance company for its role in submitting millions of dollars of false claims to federal healthcare programs. The allegations resolved included liability under the False Claims Act (FCA).

After a multiple-year investigation, the United States announces settlements with the following defendants: Baptist Health, who owns and operates four hospitals in Jacksonville (settlement of $2.89 million); Memorial Hospital, Specialty Hospital, Lake City Medical Center, and Orange Park Medical Center (collective settlement of $2.37 million); UF Health Jacksonville (settlement of $1 million); and Century Ambulance Service (settlement of $1.25 million).

In reaching this settlement, the parties resolved allegations that, from January 1, 2009, until April 2014, the hospitals provided certificates of medical necessity that attested to the need for basic life support, non-emergency ambulance transports even when these transports were not medically necessary.

"Hospital staff that certify the medical need for services when they are in fact not medically necessary fail in their role as gatekeepers of valuable taxpayer-funded health care programs," said Gregory E. Demske, chief counsel to the Inspector General of the U.S. Department of Health and Human Services Office of Inspector General.

With respect to Century Ambulance, the parties resolved allegations, for the same time period, that Century Ambulance knowingly up-coded claims from basic to advanced life support, unnecessarily transported patients, and unnecessarily transported patients to their homes in an "emergent" fashion.

"The United States Attorney's Office is committed to taking the steps necessary to protect Medicare, TRICARE, and other federal health care programs from fraud," U.S. Attorney A. Lee Bentley said.  "Whether the fraud is intentional or the product of deliberate ignorance, we will pursue these cases and recover taxpayer money."

The settlement involved false claims submitted to Medicare, TRICARE, Medicaid, and the Federal Employees Health Benefits Program managed by the Office of Personnel Management. This case was initiated by the filing of a qui tam lawsuit filed by Shawn Pelletier, a former employee of Century Ambulance. Mr. Pelletier will collect more than $1.2 million in proceeds from the settlements.

"Ambulance companies must ensure that services billed to federal healthcare programs are medically necessary and reasonable," Demske said. "Billing Medicare and Medicaid for transports that amount to taxpayer-funded taxi services will not be tolerated."

The United States was unable to reach settlement with one defendant: Liberty Ambulance.  The United States intends to pursue claims against that defendant and plans to file a civil complaint in the near future.  The United States alleges that Liberty knowingly submitted medically unnecessary claims for reimbursement in violation of the federal healthcare program requirements. 

"Our office is committed to working with other law enforcement organizations to ensure that both federal employees and taxpayers are protected from unscrupulous organizations that seek to reap profits by defrauding government programs such as the Federal Employees Health Benefits Program," said Patrick E. McFarland, inspector general for the U.S. Office of Personnel Management.  "We will continue to work to hold such entities accountable for their wrongdoing."

The claims resolved by the settlement are allegations only, and there has been no determination of liability.