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Feds detail alleged Medicare fraud by Prime

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The U.S. Justice Department alleges that executives of Prime Healthcare, which the Feds have been investigating, were deeply involved in driving up admission rates among Medicare beneficiaries, regardless of medical necessity.

The department asserts that under the direction of President and CEO Prem Reddy, M.D., Prime —including 14 hospitals it owns — targeted Medicare beneficiaries for hospital admissions “without regard to medical need”.

Fierce Healthcare reports that the federal prosecutors say that Dr. Reddy urged physicians, in Fierce’s words, “to factor in each patient’s insurance coverage when deciding whether to admit, and took steps to eliminate observation status for patients with Medicare coverage—even going so far as to remove ‘observation status’ from admission forms.”

Fierce continued: “The California-based system is also accused of instructing hospitals to set arbitrary inpatient admission quotas at 20-30 percent, and the DOJ says Reddy personally reprimanded emergency department physicians who fell below those quotas or missed opportunities to admit Medicare beneficiaries, even for minor health issues like colds, back pain, ear infections and urinary tract infections. Furthermore, Prime management altered industry guidelines for hospital admissions to reflect a more lenient standard, and passed them off to employees as unchanged, the complaint says.”

The Prime case is only one of many signs that the federal government is trying to crack down hard on  what is apparently very widespread Medicare fraud.

For the FierceHealthcare story on this, please hit this link.

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