Becker's Hospital Review

34 CFO / FINANCE Providence Health accused of $188M upcoding scheme: 6 things to know By Kelly Gooch D ata analytics firm Integra Med Ana- lytics filed a lawsuit against Renton, Wash.-based Providence Health & Services seeking $188.1 million related to alleged Medicare upcoding. Here are six things to know: 1. Integra filed a False Claims Act lawsuit Aug. 10 in the U.S. District Court of Cen- tral California against Providence Health & Services, which is now Providence St. Joseph Health. e lawsuit alleges Providence rou- tinely used unwarranted major complication and comorbidity secondary codes on Medi- care claims to inflate reimbursement. 2. According to the 100-page lawsuit, In- tegra discovered the unwarranted second- ary codes during an analysis of Medicare claims dating back to 2011. Integra said an investigation of the business practices of Providence and its consultant, clinical documentation improvement company J.A. Thomas and Associates, "confirmed that Providence's false Medicare claims were not only intentional but were part of a system- atic effort to boost its Medicare revenue." 3. The lawsuit specifically alleges Prov- idence and its consultant were "pushing doctors to make unwarranted diagnoses" and "using leading queries to change doc- tors' original diagnoses." Integra claims JA- TA's proprietary software also was made to manipulate diagnoses. 4. Adding a complication or comorbidity secondary code to a Medicare claim can re- sult in an increased claim value of between about $1,000 and $10,000, according to the lawsuit. Adding a major complication or comorbidity secondary code can result in an increased claim value of between $1,000 and $25,000. Integra said it found 1,429 of Providence's more than 11,000 claims involving a femoral neck fracture had an accompanying secondary major complica- tion or comorbidity of encephalopathy. 5. Overall, Integra seeks to recover more than $188.1 million paid by the federal government in connection with Providence's actions. 6. A Providence spokesperson told Becker's Hospital Review hospital officials received a partial version of the complaint and are thoroughly reviewing the allegations. "Pri- or to that review, we reiterate that Provi- dence St. Joseph Health follows rigorous standards for Medicare reimbursement claims, based on all relevant regulation and supported by our core values. The gov- ernment has declined to be a party in the litigation and we will proceed based upon our review and how and if the case moves forward," she said. n Mississippi hospital files for bankruptcy By Ayla Ellison M agee (Miss.) General Hospital filed for Chapter 11 bankruptcy Aug. 24. The hospital entered bankrupt- cy protection to reorganize its debt, and officials said the facil- ity will remain open during the bankruptcy process. "The hospital is not closing," Frank Wade, MD, a member of the hospital's board, told Ma- geeNews.com. "We are reorga- nizing. This is not the end, but a beginning to a stronger future for Magee General Hospital." In its bankruptcy petition, Ma- gee General Hospital listed its assets as between $1 million and $10 million and listed its liabilities in the same range. n South Carolina hospital to close: 4 things to know By Ayla Ellison F airfield Memorial Hospital in Winnsboro, S.C., the only hospital in its county, will close by the end of 2018, according to The State. Here are four things to know: 1. Fairfield Memorial Hospital serves patients in Fairfield County, which has nearly 23,000 residents. Although a date has not been set for the hospital to shut down, local officials have already taken steps to prepare for the hospital's closure. 2. Local leaders have strengthened the county's ambulance system, raised paramed- ics' wages and are working to buy buildings on Fairfield Memorial's property to lease back to physicians, according to the report. 3. Columbia, S.C.-based Providence Health, part of Brentwood, Tenn.-based LifePoint Health, will open a standalone emergency room about a mile away from Fairfield Me- morial Hospital. Providence broke ground on the facility in early 2018, and it is expect- ed to open in December. "We are proud to collaborate with Fairfield Memorial Hospital and Fairfield County to preserve critical access to emergency care for residents of this community," Prov- idence Health Market CEO Scott Campbell said in a press release in February. "This new facility will help transform the delivery of local healthcare services to a sustainable model that better meets the needs of this region." 4. The closure of Fairfield Memorial Hospital is part of a national trend of rural hos- pitals shutting down. Eighty-seven rural hospitals have closed since 2010, including four in South Carolina, according to research from the North Carolina Rural Health Research Program. n

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