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Anne Arundel Medical Center to pay more than $3 Million to settle federal false claim act allegations

Baltimore, Maryland – Anne Arundel Medical Center (“AAMC”), located in Annapolis, Maryland, has agreed to pay the United States $3,154,000 to settle allegations under the False Claims Act that it submitted false claims to Medicare for services that were not medically necessary.

The settlement agreement was announced today by United States Attorney for the District of Maryland Robert K. Hur; Special Agent in Charge of the Office of Inspector General for the Department of Health and Human Services, Maureen Dixon; Norbert E. Vint, Acting Inspector General of the U.S. Office of Personnel Management; and Robert E. Craig, Jr., Special Agent in Charge for the Defense Criminal Investigative Service, Mid-Atlantic Field Office.

“Companies that submit false bills to the government must be held accountable. The United States Attorney’s Office is committed to taking the steps necessary to protect Medicare and other federal healthcare programs from fraud and abuse and recover taxpayers’ money,” said U.S. Attorney Robert K. Hur. 

In or about June 2007, AAMC opened its Anticoagulation Clinic (“the Clinic”) to monitor outpatient’s anticoagulation therapy.  Patients who take Coumadin or the generic equivalent have their blood routinely tested to monitor their clotting times.  These tests are known as prothrombin time international normalized ration (PT-INR) tests.  These tests measure how much time it takes for a patient's blood to clot and can be billed by a clinic using Current Procedural Terminology (CPT) code 85610.  If test results indicate the need to adjust a patient’s Coumadin dose, or the patient presented with a change in medical condition, the provider may perform, and submit a claim for, an Evaluation and Management (E/M) service.  According to the settlement agreement, between January 1, 2010 and December 31, 2013, AAMC submitted false claims to Medicare, TRICARE, and the Federal Employees Health Benefits Program for E/M services that were not medically reasonable and necessary at the same time it submitted and was paid for claims for the blood tests.

Effective January 1, 2014, CMS updated the hospital outpatient prospective payment system by bundling PT-INR tests with E/M services, when E/M services were provided during the same visit.  The new CPT code that the clinic would use is G0463.    According to the settlement agreement, between January 1, 2014 and December 31, 2017, AAMC submitted false claims to Medicare for both the bundled code G0463 and CPT 85610, notwithstanding that the PT-INR tests were included in G0463 claims.

The United States alleged that for the time period before January 1, 2014, a substantial percentage of the claims for CPT 99211 submitted by AAMC were not medically reasonable and necessary when submitted with CPT 85610.  Further, the United States alleged that after January 1, 2014, all claims submitted by AAMC for CPT 85610 represented false claims when submitted with G0463.      

The claims resolved by this settlement are allegations.  The settlement is not an admission of liability by AAMC, nor a concession by the United States that its claims are not well founded.

Contemporaneous with the civil settlement, AAMC entered into a five-year Corporate Integrity Agreement (CIA) with the HHS-OIG which requires, among other things, the implementation of a risk assessment and internal review process designed to identify and address evolving compliance risks on an ongoing basis.  The CIA requires training, auditing, and monitoring designed to address the conduct at issue in the case.        

The settlement resolves a lawsuit brought by Barbara McHenry, a former AAMC employee, under the qui tam, or whistleblower, provisions of the False Claims Act, captioned United States, et al. ex rel. McHenry v. Anne Arundel Medical Center, Case No. ELH-15-1256.  As part of the settlement, the whistleblower will receive $473,100.

The Maryland United States Attorney’s Office’s action in this matter illustrates its commitment to combat health care fraud using the False Claims Act.  Tips from all sources about potential fraud, waste, abuse, and mismanagement can be reported to the Department of Health and Human Services, at 800-HHS-TIPS (800-447-8477).          

United States Attorney Robert K. Hur commended the U.S. Department of Health and Human Services - Office of Inspector General; OPM-Office of Inspector General; and the Defense Criminal Investigative Service, Mid-Atlantic Field Office for its work in the investigation.  Mr. Hur also thanked Assistant United States Attorney Roann Nichols, who handled the case.

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