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Half a dozen hospitals in Indiana and Alabama agreed to pay between $382,000 and $3.16 million to settle a federal lawsuit that claimed the hospitals defrauded Medicare by having patients stay overnight after kyphoplasty, a procedure to treat vertebral fractures that is typically done on an outpatient basis.
The hospitals that settled are:
The settlements are part of an investigation of Medicare fraud related to kyphoplasty procedures billed to Medicare between 2002 and 2008. Last year, Medtronic, which bought kyphoplasty balloon maker Kyphon in 2007, paid the federal government $75 million to settle its part in the whistleblower case filed by former Kyphon employees.
The whistleblowers, former reimbursement manager Craig Patrick and former regional sales manager Charles Bates, told authorities that Kyphon representatives persuaded hospitals to keep kyphoplasty patients overnight after the procedure, which usually takes 1 to 2 hours and is performed routinely in an outpatient setting. The overnight stay increased the cost to Medicare by thousands of dollars per patient.
Three Minnesota hospitals settled for $2.28 million in similar lawsuits in May.
Key to the investigation was lack of documentation supporting the physicians' and hospitals' decision to keep the patients for an overnight stay. At least 1 health system, St. John's in Indiana, has changed its protocols regarding kyphoplasty. "St. John's has taken steps to ensure that appropriate documentation is present in the medical record for these procedures going forward," a St. John's spokesperson said in a press report.
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