Saint Barnabas Health Care System will pay $265 million to settle charges that it cheated Medicare out of more than half a billion dollars. The payment will resolve allegations that the hospitals inflated charges for Medicare patient care and received supplemental "outlier" payments to which they was not entitled.
Court papers indicate that numerous other unidentified hospitals are apparently facing similar accusations that they abused a Medicare provision that provides for supplemental payments for unusually expensive cases, referred to as "outliers."
The suit was the result of qui tam complaints filed by whistleblowers under the False Claims Act.
Law.com and The Wall Street Journal (subscription required) reported on the settlement on June 16, 2006.