DOJ Announces $20M Healthcare Fraud Settlement

Baycare Health and its affiliated hospital subsidiaries have agreed to a $20 million settlement with the Department of Justice (DOJ) regarding allegations of violations of the False Claims Act, according to a press release. The four subsidiaries include Morton Plant Hospital, Mease Countryside Hospital, Mease Dunedin Hospital and St. Anthony’s Hospital.

Medicaid programs provide assistance with medical bills for low income individuals and individuals with disabilities. The funds for these programs come from the federal and state governments through a series of matching funds.

Non-governmental entities are not permitted to make “non-bona fide” payments to Medicaid. “A non-bona fide donation is a payment — in cash or in kind — from a private provider to a governmental entity that is then returned to the private provider as the state share of Medicaid. The private provider’s donation triggers a corresponding federal expenditure for the federal share of Medicaid, which is also paid to the private provider. This unlawful conduct causes federal expenditures to increase without any corresponding increase in state expenditures, since the state share of the Medicaid payments to the provider comes from and is returned to the provider.”

The United States accused Baycare of making donations to a trust, which then contributed those funds to Medicaid where they were used for non-bona fide transactions. The settlement covers both the federal action and the qui tam United States ex rel. Bomar v. Bayfront HMA Medical Center LLC.

The qui tam action was filed by Larry Bomar, a former hospital reimbursement manager in Florida, who will receive $5 million for his action. The matter was handled by Civil Division Fraud Section Attorneys Alison B. Rousseau and Jonathan T. Thrope and Assistant U.S. Attorney Carolyn B. Tapie for the Middle District of Florida.