City of Dallas to Pay $2.47 Million to Resolve Allegations That It Caused Improper Medicare and Medicaid Ambulance Claims

DALLAS—The City of Dallas has agreed to pay the U.S. and Texas $2.47 million and enter into certain compliance obligations to resolve allegations that it violated the civil False Claims Act and Texas Medicaid Fraud Prevention Act, announced U.S. Attorney James T. Jacks of the Northern District of Texas. The U.S. and Texas contend Dallas caused “upcoded” claims to be submitted to Medicare and Medicaid for city-dispatched 911 ambulance transports between 2006 and 2010. Dallas fully cooperated with the investigation, and by settling did not admit any wrong-doing or liability.

Ambulance services generally are coded either as basic life support level or advanced life support (ALS). ALS transports are reimbursed at a higher rate by both Medicare and Medicaid. The U.S. and Texas contend Dallas directed its billing contractor to code every 911-dispatched transport at the ALS level, which indicates an ALS service was furnished and/or the patient’s condition necessitated an ALS intervention. The U.S. and Texas believe Dallas caused to be submitted for payment claims falsely representing to Medicare and Medicaid that such ALS services were appropriate and furnished by Dallas personnel when in fact no ALS-service was rendered and/or the patient did not require an ALS transport.

The U.S. and Texas initiated the investigation in response to an August 2009 whistleblower suit brought by Douglas Moore, a former employee of Dallas’ auditing department. Under the False Claims Act and Texas Medicaid Fraud Prevention Act, private individuals may bring actions alleging fraud on behalf of the U.S. and Texas and collect a share of any proceeds recovered by the suit. Mr. Moore can receive up to 30 percent of the recovery under the settlement.

U.S. Attorney Jacks praised the efforts of the Office of Inspector General of the U.S. Department of Health and Human Services and FBI. “Any time false claims are submitted for payment, the nation’s health insurance programs suffer,” said Special Agent in Charge Mike Fields of the OIG’s Dallas Regional Office. Our HHS OIG investigators will continue to work closely with our law enforcement partners to identify providers who improperly receive crucial Medicare and Medicaid dollars.”

The case was handled by Assistant U.S. Attorney Sean McKenna, Assistant Texas Attorney General Sinty Chandy, and OIG Senior Counsel Ellen Slavin. The case is captioned United States of America, et al. ex rel. Moore v. City of Dallas, et al. Civil Action No. 3:09-cv-1452-O (N.D. Tex.). Investigations of other ambulance providers remain ongoing.