Cape Cod Hospital Agrees to $24.3 Million Settlement for Medicare Fraud Allegations Over TAVR Procedures

Cape Cod Hospital Agrees to $24.3 Million Settlement for Medicare Fraud Allegations Over TAVR Procedures

Cape Cod Hospital, based in Hyannis, Massachusetts, has agreed to pay $24.3 million to resolve allegations under the False Claims Act.

The hospital was accused of submitting claims to Medicare for transcatheter aortic valve replacement (TAVR) procedures that did not comply with Medicare rules regarding patient evaluation.

Background on TAVR Procedures and Medicare Requirements

Since 2015, Cape Cod Hospital has offered TAVR procedures for patients with aortic stenosis, a condition that restricts blood flow from the heart.

Medicare rules require hospitals to engage specific clinical personnel for independent patient evaluations, document their clinical judgments, and share these with the medical team performing the TAVR procedures.

Allegations of Non-Compliance

From November 1, 2015, to December 31, 2022, the hospital allegedly submitted hundreds of claims that failed to meet these requirements.

In some cases, not enough physicians evaluated the patients, and in others, the physicians did not document or share their clinical judgments.

Government’s Stance on Medicare Compliance

Principal Deputy Assistant Attorney General Brian M. Boynton emphasized the necessity for hospitals to adhere to Medicare rules.

He stated that the Justice Department would hold healthcare providers accountable for non-compliance with reimbursement requirements.

Acting U.S. Attorney’s Statement on Patient Safety

Acting U.S. Attorney Joshua S. Levy highlighted the importance of ensuring patient safety over hospital profits.

He pointed out that the hospital ignored Medicare rules and warnings, resulting in millions of dollars of undeserved Medicare funds.

Corporate Integrity Agreement

As part of the settlement, Cape Cod Hospital has entered into a five-year corporate integrity agreement with the Department of Health and Human Services, Office of Inspector General (HHS-OIG).

This agreement includes annual reviews of Medicare claims by an Independent Review Organization.

HHS-OIG’s Commitment to Integrity

Special Agent Roberto Coviello from HHS-OIG reaffirmed the agency’s dedication to protecting the Medicare program’s integrity and encouraged the public to report any instances of fraud.

Hospital’s Cooperation in the Investigation

Cape Cod Hospital received credit for disclosing the violations, cooperating with the investigation, and taking remedial actions.

The hospital voluntarily provided materials, identified relevant medical records, admitted to non-compliance, and implemented corrective measures.

Whistleblower Involvement

The allegations were brought under the qui tam provisions of the False Claims Act by Dr. Richard Zelman, a former physician at Cape Cod Hospital. Dr. Zelman will receive approximately $4.36 million as part of the settlement.

Coordinated Effort to Combat Healthcare Fraud

The resolution was the result of a coordinated effort between the Justice Department, the U.S. Attorney’s Office for the District of Massachusetts, HHS-OIG, and the FBI.

The government continues to prioritize combating healthcare fraud using tools like the False Claims Act.

Reporting Fraud and Mismanagement

Tips and complaints about healthcare fraud, waste, abuse, and mismanagement can be reported to HHS at 800-HHS-TIPS (800-447-8477).

Legal Handling of the Case

The case was managed by Trial Attorney Kimya Saied of the Fraud Section and Assistant U.S. Attorney Andrew A. Caffrey, III for the District of Massachusetts.

No Determination of Liability

Except for the facts admitted by Cape Cod Hospital, the claims in the complaint are allegations only, and there has been no determination of liability.

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