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 patient risk.”
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 Americans.”