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55 Hospitals Nationwide Agree to Settle Massive Charges of Medicare Fraud for $34 Million

Authored by CSCS

In a large nationwide conspiracy covering 55 hospitals and 21 states, the Department of Justice (DOJ) has helped put an end to a massive source of Medicare waste. Craig Patrick and Charles Bates, the whistleblowers in this case, made the decision to blow the whistle after leaving Kyphon, Inc. Kyphon counsels hospitals on kyphonplasty procedures, which are minimally invasive spinal procedures used to treat spinal fractures, often from the result of osteoporosis. These procedures can safely and effectively be performed as outpatient procedures.

The charges revealed that Kyphon was counseling these hospitals to perform the procedures after a costly hospital admission. This was done to pad the Medicare bill and bring in more money for the hospitals and Kyphon.

In response to this settlement, U.S. Attorney William J. Hochul, Western District of New York, said that "this office will continue to ensure that sound medical decisions determine the ultimate treatment of a patient, not the financial interests of hospitals. We will not stand by and allow hospitals to inflate their profits based on unnecessary hospital admissions at the expense of the Medicare program or any other federal program. The settlements announced today will help maintain the integrity of this important program and all government-funded programs."

The effect of putting a stop to this massive fraud scheme will not only prevent the waste of precious Medicare resources, but also put the medical decision making power back into the hands of a patient that has been counseled in a proper and unbiased manner.