Sylvia Daniel, a former health information coder at Vibra Hospital of Southeastern Michigan, will receive a whistleblower award of at least $4 million after filing a qui tam lawsuit alleging the hospital billed Medicare for medically unnecessary services, the Department of Justice announced Wednesday. Vibra Healthcare LLC, a Mechanicsburg, Pennsylvania-based national hospital chain, has agreed to pay $32.7 million plus interest to resolve claims its facilities violated the False Claims Act.
“Medicare beneficiaries are entitled to receive care that is determined by their clinical needs and not the financial interests of healthcare providers,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division, commenting on the settlement of Sylvia Daniel’s whistleblower lawsuit against Vibra Healthcare.
“All providers of taxpayer-funded federal healthcare services, whether contractors or direct billers, will be held accountable when their actions cause false claims for medically unnecessary services to be submitted.”
Whistleblower Suit Claims Vibra Healthcare Billed Medicare for Medically Unnecessary Services
Vibra Healthcare operates 36 long-term care hospitals and inpatient rehabilitation facilities across 18 states. These facilities offer inpatient services for patients requiring long hospital stays or those needing rehabilitative services requiring hospital-level of care.
Sylvia Daniel filed the initial whistleblower lawsuit in the Southern District of Texas, the location of a Vibra long-term care hospital, after discovering that Vibra was admitting patients who did not exhibit symptoms that would qualify them for long-term care or hospital-level rehabilitative services.
Law enforcement intervened in the lawsuit, alleging that, between 2006 and 2013, five Vibra long-term care hospitals and one Vibra inpatient rehabilitation facility admitted patients that did not qualify for admission and extended patient stays without considering medical necessity, qualification or quality of care. The government also alleged that Vibra facilities chose to ignore the recommendations of its clinicians that patients were cleared for discharge.
Improper billing submissions to Medicare for medically unnecessary services is a serious violation of the False Claims Act, which serves to protect taxpayer funds and ensure proper patient care. “Medical necessity is fundamental if health providers wish to claim taxpayer funds for medical care,” said Special Agent in Charge C.J. Porter of the U.S. Department of Health and Human Services’ Office of Inspector General. “OIG is committed to protecting precious Medicare dollars and ensuring that beneficiaries receive quality, necessary long term care.”
Vibra Pays $32.7M Settlement, Enters Chain-Wide Corporate Integrity Agreement
In addition to the $32.7 million settlement, all Vibra facilities will enter into a corporate integrity agreement with the U.S. Department of Health and Human Services Inspector General. The claims resolved by the settlements are allegations only and there has been no determination of liability on the charges of cheating Medicare by billing for medically unnecessary services.
The False Claims Act is a federal law which allows private citizens like Ms. Silva to file a lawsuit on behalf of the United States and, if successful, share in 10% to 30% of the recovery. The Justice Department reports Daniel will receive a whistleblower award of at least $4 million in this case for her information and help in blowing the whistle on Vibra Healthcare’s alleged misconduct with respect to Medicare billing.
“Pursuing and recovering fraudulent billing for unnecessary services is a priority of my office,” stated U.S. Attorney John E. Kuhn Jr. for the Western District of Kentucky. “This significant case against Vibra Healthcare and today’s settlement agreement is but one example of the vigorous work against healthcare fraud taking place in the Western District of Kentucky and across the nation.”
In recent years the False Claims Act has been used to recover billions in taxpayer money from healthcare and other companies exposed by whistleblowers for cheating on billing government programs and other schemes.