Georgia Hospital Pays U.S. $13.9 Million to Resolve Medicaid False Claims Act Allegations

Thomasville Hospital Allegedly Made False Representations to State’s Medicaid Program

WASHINGTON – John D. Archbold Memorial Hospital Inc. has paid the United States a total of $13.9 million to settle allegations that the hospital submitted false claims to the state of Georgia’s Medicaid program, the Justice Department announced today.

The settlement resolves allegations that between November 2002 and July 2008, the Thomasville, Ga.-hospital made false representations to the Georgia Department of Community Health, the state agency that administers the Medicaid program in Georgia, that it was a public hospital for Medicaid purposes in order to increase the amount of Medicaid funds provided to the hospital. Under Medicaid rules, only public hospitals may participate in the Medicaid Upper Payment Limit (UPL) program. In addition, public hospitals receive additional Disproportionate Share Hospital (DSH) program funds that are not available to private hospitals. Contrary to its certification to the Georgia Department of Community Health, Archbold Memorial was in fact a private hospital, and as a result received millions of dollars in UPL and DSH funds to which it was not entitled.

"We are committed to protecting the integrity of the Medicaid program and ensuring that health care providers do not game the system to the detriment of the poor, disabled, and young people served by this important program," said Tony West, Assistant Attorney General for the Civil Division of the Department of Justice.

"The U.S. Attorney’s Office will continue to use the False Claims Act to protect programs like Medicaid, which rely on the honesty and accuracy of information provided by program providers to determine the amount of money paid by the United States," said Sally Quillian Yates, U.S. Attorney for the Northern District of Georgia in Atlanta. "Any false statements made in order to increase the amount of money the federal government spends to provide health care to its beneficiaries will be ferreted out and the funds recovered."

The civil settlement resolves a lawsuit filed in federal court in the Northern District of Georgia under the qui tam, or whistleblower, provisions of the False Claims Act, which allow private citizens to bring civil actions on behalf of the United States and share in any recovery. As part of today’s resolution, the whistleblower – Wesley Simms, M.D.– will receive $695,151 from the settlement amount.

This settlement is part of the government’s emphasis on combating health care fraud.  One of the most powerful tools in that effort is the False Claims Act, which the Justice Department has used to recover more than $5.3 billion since January 2009 in cases involving fraud against federal health care programs. The Justice Department’s total recoveries in False Claims Act cases since January 2009 now approach $6.8 billion.

The settlement was the result of a coordinated effort among the U.S. Attorney’s Office for the Northern District of Georgia, the Commercial Litigation Branch of the Justice Department’s Civil Division, and the Department of Health and Human Services’ Office of Inspector General and Office of Counsel to the Inspector General.