Detroit Medical Center NPT Testing Fraud Settlement
Federal qui tam lawsuit results in $361,831 settlement for improper Medicare and Medicaid billing practices at Harper Hospital Sleep Laboratory.
Case Announcement
David Haron announced the settlement of a Federal False Claims Act/Qui Tam suit filed in 1996 against the Detroit Medical Center, Harper Hospital and Dr. C.B. Dhabuwala.
Haron represented George Karadsheh, one of two Relators (Plaintiffs) filing suits. As a result of the Qui Tam suits, the United States government entered into a Settlement Agreement, in which the Defendants agreed to pay $361,831 to the government.
Whistleblower Awards and Recovery
The Relators collectively received $61,851 as their share of the government's recovery, representing approximately 17% of the settlement—consistent with qui tam reward guidelines when the government intervenes in a case.
Additionally, Defendants paid an additional $45,000 for expenses, statutory attorneys fees and costs. This demonstrates how the False Claims Act protects whistleblowers from bearing the financial burden of bringing fraud to light.
The Government's Allegations
The United States alleged that:
From January 1, 1988 through December 31, 1992, Defendants improperly presented or caused Harper to present claims to the Medicare and Medicaid programs for nocturnal penile tumescence ("NPT") tests that had been performed at Harper's Sleep Laboratory (currently known as the "Sleep Disorders Center").
During the relevant time frame, both the Medicare and Medicaid programs had established reimbursement guidelines for NPT tests performed by participating providers. Such guidelines indicated that providers could not bill either Medicare or Medicaid separately for NPT tests because reimbursement for NPT tests was considered to be included in the reimbursement paid to providers for office visits related to such tests.
The Billing Fraud Scheme
Notwithstanding these guidelines, whenever a Medicare or Medicaid patient at the Harper Sleep Disorders Centers received an NPT test, Harper routinely submitted claims to the Medicare or Medicaid program for:
- •An office visit
- •PLUS a claim for the NPT test
- •AND/OR numerous additional tests which were components of the NPT test (i.e., electromyogram, electrocardiogram, electro-oculogram, etc.)
This practice violated Medicare and Medicaid program rules because the component tests were not separately ordered by a physician or medically necessary for the treatment of illness or injury. This is a form of "unbundling" fraud—billing separately for tests that should be included in a single procedure code.
Settlement Note
Defendants settled the suits but did not admit any liability to the government. This is common in qui tam settlements.
The United States prosecuted the action through Saul A. Green, United States Attorney in Detroit, Michigan and Carolyn Bell Harbin, Assistant United States Attorney.
Do You Know About Medical Billing Fraud?
If you work in a hospital, medical practice, or healthcare organization and have witnessed improper billing practices to Medicare or Medicaid, you may be entitled to a significant reward. Contact our experienced qui tam attorneys for a confidential evaluation.
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