Bryan Cohen Feb. 11, 2013, 7:22pm

NEW YORK (Legal Newsline) - New York Attorney General Eric Schneiderman announced a $2.3 million settlement on Thursday with a non-profit hospital network and one of its members to resolve allegations of improper Medicaid and Medicare billing.

The lawsuit, filed against Continuum Health Partners Inc. and St. Luke's-Roosevelt Hospital under state and federal False Claims Acts, alleged that Continuum and St. Luke's improperly billed Medicare and Medicaid for out-patient services provided at the hospital's mental health clinics between 1998 and 2010. Under the terms of the settlement, St. Luke's will repay $2,325,000 to Medicare and Medicaid.

The state of New York will recover a $1,066,887.83 portion of the settlement.

"This blatantly irresponsible behavior by a New York City hospital cost taxpayers millions of dollars and will not be tolerated by this office," Schneiderman said. "As a result of New York's strong False Claims Act, whistleblowers with knowledge of such unlawful conduct have an incentive to file complaints. My office investigates those claims, we pursue those who cheat the system and we make sure tax dollars are fully refunded and penalties are paid."

Schneiderman's office received information from a whistleblower that the hospital and SLR Psychiatric Associates, a physician's group within the hospital, allegedly double billed the state Medicaid and federal Medicare programs.

The hospital allegedly double-billed the state and federal government by billing services to Medicaid as a rate-based service while SLR billed the state and federal government on a fee-for-service basis for the same care. The hospital also allegedly sought reimbursement for non-reimbursable costs related to outpatient psychiatric visits conducted by SLR.

St. Luke's admitted responsibility for the improper billing conduct between 1999 and 2010 as part of the settlement.

The settlement is based on a whistleblower lawsuit brought by a private individual in 2008 pursuant to federal and state False Claims Acts.

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