Kusserow’s Corner: New Qui Tam Settlement–Sound Physicians, Tacoma, Washington

The Department of Justice (DOJ) announced on July 3 a settlement with Sound Physicians that addresses allegations that it knowingly submitted to federal health benefits programs inflated claims on behalf of its hospitalist employees for higher and more expensive levels of service than were documented by hospitalists in patient medical records between 2004 and 2012.  The DOJ explained that the hospitalists are physicians, typically trained in internal medicine, who provide care exclusively to hospital inpatients and have no office or outpatient practice.  The lawsuit was filed by a former Sound Physicians employee, Craig Thomas, under the qui tam, or whistleblower, provisions of the False Claims Act, who will be receiving $2.7 million of the $14.5 million settlement for exposing Sound Physicians’ inflated claims (United States ex rel. Thomas v Sound Inpatient Physicians, Inc., C09-5301RBL ((W.D. Wash.)).

The settlement resolves issues that Sound Physicians improperly billed Medicare and other federal health care programs. Sound Physicians is a Tacoma, Washington-based provider of hospitalists and other physicians to hospitals and other medical facilities. It employs more than 700 hospitalists and post-acute physicians, who provide services at 70 hospitals and a growing network of post-acute facilities in 22 states.

The DOJ stated this case was another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 and was the result of a coordinated effort that included the DHHS Office of Inspector General (OIG), Department of Defense OIG, TriCare, and Defense Criminal Investigative Services (DCIS); Office of Personnel Management (OPM) OIG; and Department of Veterans Affairs OIG.

Richard P. Kusserow served as DHHS Inspector General for 11 years.  He currently is CEO of Strategic Management Services, LLC (SM), a firm that has assisted more than 3,000 organizations and entities with compliance related matters.  The SM sister company, CRC, provides a wide range of compliance tools including sanction-screening.

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Copyright © 2013 Strategic Management Services, LLC.  Published with permission.