LOS ANGELES (Legal Newsline) – The Department of Justice
announced that the United States intervened in a case against Prime Healthcare
Services Inc.; the company’s founder and chief executive office, Dr. Prem Reddy;
and 14 Prime hospitals in California.
“The Department of Justice is committed to ensuring that
health care providers do not inappropriately seek to profit at the expense of
federal health care programs,” Principal Deputy Assistant Attorney General
Benjamin C. Mizer, head of the Justice Department’s Civil Division, said. “Schemes such as this one can contribute
significantly to the rising cost of health care delivery and create needless
The lawsuit charges that the emergency departments at Prime
facilities improperly admitted patients and submitted false Medicare claims. Dr.
Reddy allegedly ran a scheme that pressured doctors to raise inpatient
admission rates, even when the patients did not need emergency treatment.
Because of these alleged actions, the lawsuit claims Prime Healthcare Services
submitted false claims to Medicare.
“Fraudulent billing practices, such as those alleged in this
civil lawsuit, harm taxpayers who fund health care programs, such as Medicare,”
U.S. Attorney Eileen M. Decker for the Central District of California said. “The Justice Department works collaboratively
with law enforcement agencies, regulators and, in some cases, private citizens
to ensure the integrity of a system that provides healthcare to millions of