Becker's Hospital Review

19 CFO / FINANCE Chicago hospital defeats allegations of 'ghost payroll' scheme By Ayla Ellison A n Illinois federal court on Sept. 14 dismissed a whistleblower law- suit alleging University of Chicago Medical Center, Medical Business Office and Trustmark Recovery Services violated the False Claims Act, according to Bloomberg Law. MBO and Trustmark provided medical billing and debt collection services for UCMC. e whistleblowers, Kenya Sibley, Jasmeka Collins and Jessica Lopez, alleged MBO and Trust- mark engaged in a "ghost payroll" scheme that involved regularly falsifying UCMC invoices, listing employes who didn't work on the hos- pital's collections and time charges from peo- ple who were not employees. e whistleblowers, former employees of MBO and Trademark, alleged the companies and UCMC knew about the "ghost payroll" scheme, and that the allegedly falsified in- voices caused the hospital to report overstat- ed wages to the federal government, trigger- ing a larger Medicare reimbursement than it was entitled to. e complaint further alleged that MBO and Trustmark engaged in a "bad debt" scheme. "MBO would regularly write-off Medicare bad debts for amounts a Medicare benefi- ciary owed without conducting a reasonable collection effort, when Medicare beneficia- ries were still paying on the debts, or when Medicare beneficiaries did not actually owe a debt," the amended complaint stated. Aer writing off the bad debt, MBO would allegedly send the bad debt to Trustmark or another collection agency for further collec- tion efforts. On Sept. 14, Judge Harry Leinenweber of the U.S. District Court for the Northern District of Illinois dismissed the amended complaint, saying the whistleblowers failed to adequate- ly allege the defendants engaged in a scheme to inflate bad debts and falsify invoices in University of Chicago's cost reports. e allegations of a "ghost payroll" scheme fail because the whistleblowers did not allege that defendants certified compliance with any regulation, which is required when filing a false claims case, the judge said in the de- cision. e amended complaint also failed to establish sufficiently UCMC's knowledge of the alleged scheme, he said. e judge also ruled that the amended complaint failed to adequately allege a "bad debt" scheme. Allegations related to MBO's and Trustmark's bad debt reports to clients cannot satisfy the requirements to show that companies or their clients submitted improp- er claims for bad debt reimbursements to the government, according to the decision. n OIG tags Arizona hospital for erroneous billing By Ayla Ellison F lagstaff (Ariz.) Medical Center failed to comply with Medicare billing requirements for three of 100 inpatient and outpatient claims reviewed by HHS' Office of Inspector General, according to an OIG report. For three claims, the hospital incorrectly billed Medi- care for inpatient stays that did meet criteria for in- patient status, the OIG said. The three claims that did not comply with Medicare billing requirements re- sulted in Flagstaff Medical Center receiving $79,216 in overpayments during the two-year audit period of January 2016 through December 2017, according to the OIG. Based on its findings, the OIG recommended the hospital refund Medicare $79,216, exercise reason- able diligence to identify and return any additional overpayments, and strengthen controls to ensure full compliance with Medicare requirements. In written comments on the draft report, Flagstaff Medical Center agreed that three claims were im- properly billed as inpatient due to human error. n 1,200 UF Health physicians, faculty to lose out on bonus pay this year By Alia Paavola T o offset millions in lost revenue from the pandemic, at least 1,200 physicians, faculty and researchers at University of Flor- ida's College of Medicine in Gainesville will lose out on their usual year-end incentive pay, according to The Gainesville Sun. UF Health physicians and faculty typically receive incentive pay on top of their base salary. The bonus pay is often given to physicians for picking up additional work or executing excellent services, while other times it helps readjust for the cost of living in the area. UF Health officials said the bonus pay will not be coming this year, as it would worsen the organization's financial position. "Any distribution of incentives would come with the effect of deepening our financial hole and stalling any forward momentum gained prior to the pandemic," Adrian Tyndall, MD, UF College of Medicine's interim dean, wrote in an email to employees, accord- ing to The Gainesville Sun. UF College of Medicine lost about $11 million in revenue from the pandemic, and UF Health's Shands Hospital saw a $46 million shortfall in its operating budget in fiscal year 2020, according to the report. Dr. Tyndall told The Gainesville Sun the incentive payment cuts avoid the "draconian" option of furloughing employees. n

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