New Jersey hospital settles qui tam suits involving Medicare outlier payments

Robert Wood Johnson University Hospital Hamilton will pay $6.35 million to settle allegations of Medicare fraud raised in two whistleblower suits, the Dept. of Justice reported. The suits had alleged that the New Jersey hospital fraudulently inflated its charges to Medicare patients to obtain larger reimbursements from the federal health care program.

These charges involved Medicare’s “outlier payments.” This supplemental reimbursement is paid to health care providers in cases where the cost of care is unusually high. The two lawsuits charged that the hospital inflated its charges to obtain supplemental outlier payments for cases that were not extraordinarily costly and for which outlier payments should not have been paid.