Joseph Health System named in $250 million settlement over Medicare violations

Irvine-based St. Joseph Health System and 10 of its affiliate hospitals, including three in Orange County, will pay $2.7 million as part of a nationwide settlement with the U.S. Department of Justice relating to cardiac devices implanted in patients in violation of Medicare coverage requirements, DOJ officials said Friday.

Advocate Good Shepherd Hospital was one of more than 400 hospitals across the country that have settled with the Department of Justice over whether Medicare was improperly charged for cardiac devices.

The device is referred to as an implantable cardioverter defibrillator. The electronic device is implanted near and connected to the heart, where it delivers a shock to restore the organ’s normal rhythm.

Medicare does not cover the implantation of these cardiac devices, which cost about $25,000, during waiting periods unless certain exceptions are met. The waiting periods are 40 days for a heart attack and 90 days for a bypass or angioplasty.

“While recognizing and respecting physician judgment, the department will hold accountable hospitals and health systems for procedures performed by physicians at their facilities that fail to comply with Medicare billing rules”, said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division, in a statement. “Our office will continue to vigilantly protect the Medicare program from potential false billing claims”.

The settlement calls for payments of $1.2 million from Cooper and $1 million from Deborah.

Susan Bonfield, a Deborah vice president, noted the government had not alleged “that any patient’s health or safety had been compromised, only that (devices) had been implanted too early, in a few cases by a matter of a day or so”.

Pennsylvania-based Catholic Health East, which is now known as Trinity Health, and 13 affiliated hospitals, including St. Francis Hospital in Wilmington, paid $11 million.

Most of the hospitals were named in a lawsuit brought under the False Claims Act, which allows private citizens to sue on behalf of the federal government and to share in the settlement.

Vroon said it’s not yet possible to determine how many times each hospital within a large system billed for the ICD procedure because audits conducted as part of the federal investigation remain sealed.

The hospitals were named in 70 settlements for more than $250 million, the Justice Department announced Friday.