CityMD agrees to $12M settlement over alleged COVID claims fraud
CityMD has agreed to pay $12.04 million to resolve allegations brought by the U.S. Department of Justice (DoJ) that they engaged in fraudulent billing practices at their urgent care centers. Despite the settlement, the company denies the allegations.
According to the DoJ, CityMD inappropriately billed the Health Resources and Services Administration, an agency of the U.S. Department of Health and Human Services, for reimbursement of COVID-19 tests as part of an emergency government program designed to cover uninsured patients for healthcare services related to the pandemic. CityMD allegedly submitted claims for reimbursement even when patients had their own private insurance coverage. Those claims were effectively paid out by Medicare.
The DoJ said the company’s erroneous emergency claims for COVID tests were filed between February 2020 and April 2022 for an undisclosed number of patients. Further, this caused labs to be reimbursed by the government for the testing when it should have been covered by patients’ insurance plans. The accusation stemmed from a 2020 whistleblower complaint made by a CityMD patient.
CityMD fully cooperated with the investigation, including working with a third-party to determine how much money the federal government program lost as a result, the DoJ noted.
The company does not admit to any wrongdoing.
"Uninsured Americans who were at risk from COVID-19 were covered by emergency funding programs that made available to them the testing, vaccines and treatments that they needed," DoJ attorney Philip R. Sellinger said in a statement. "The alleged misuse of these funds is something we cannot and will not tolerate."
CityMD operates over 100 walk-in urgent care clinics in New York and New Jersey. In 2019, the company merged with Summit Health, which is owned by Walgreens.
HealthExec has reached out to CityMD for comment and received the following statement:
"CityMD is proud of the healthcare services we provided to patients throughout the pandemic. When many medical practices were closed during the lockdown, we remained open and available to patients. Our dedicated team members bravely came to our locations and, despite all of the unknown, supported and cared for our patients in extremely challenging times. For that, we are so thankful to our physicians, providers and staff.
The recent settlement is neither a finding of liability nor an admission of wrongdoing, and CityMD denies the allegations. However, we settled this matter to avoid the cost and burden of prolonged litigation. We remain proud that we were available to our patients at all times throughout the pandemic, and we look forward to continuing to serve them. We will always remain committed to our patients and our employees as our top priority."
Chad is an award-winning writer and editor with over 15 years of experience working in media. He has a decade-long professional background in healthcare, working as a writer and in public relations.