Florida-based Baptist Health System Inc. has agreed to pay the government $2.5 million to settle allegations that its subsidiaries violated the False Claims Act by submitting claims to federal health care programs for medically unnecessary services and drugs.

Baptist Health is the parent company for a network of affiliated hospitals and medical providers in the Jacksonville, Florida, area, that sees Medicare, Medicaid, TRICARE and the Federal Employee Health Benefits Program beneficiaries. According to a whistleblower (qui tam) suit filed by Verchetta Wells, a former employee of Baptist Health, between September 2009 and October 2011, two neurologists in the Baptist Health network misdiagnosed patients with various neurological disorders, such as multiple sclerosis. This led to Baptist Health billing the government for medically unnecessary services, and although Baptist Health placed one of the physicians at issue on administrative leave in October 2011, it allegedly did not tell the government what had happened until September 2012.

“Providers that bill for unnecessary services and drugs contribute to the soaring cost of health care,” said Assistant Attorney General for the Justice Department’s Civil Division Stuart F. Delery in the Department of Justice (DOJ) press release announcing the settlement.  “Providers must deal fairly and honestly with federal health care programs, and the Justice Department will investigate aggressively and hold accountable those who do not.” 

The state of Florida, which paid for some of the Medicaid claims at issue, will receive $19,024 of the settlement amount. Wells will receive $424,155.

The government joining Wells’ suit and the settlement were part of the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, a now 5-year-old partnership between the DOJ and the Department of Health and Human Services that so far has recovered a total of more than $19.1 billion through False Claims Act cases.