TeamHealth to pay $60 million to settle overbilling allegations

Physician staffing company TeamHealth has agreed to pay a $60 million penalty to settle allegations that one of its subsidiaries told hospitalists to “up-code” and overbill Medicare, Medicaid and other federal programs.

According to the U.S. Department of Justice, North Hollywood, Calif.-based IPC, which was acquired by TeamHealth in 2015, “knowingly and systemically” encouraged hospital staff to bill for more than the services which were actually provided. It allegedly pressured hospitalists with lower billing levels to “catch up” to their peers involved in the scheme.

“Medical providers who fraudulently seek payments to which they are not entitled will be held accountable,” Zachary Fardon, U.S. Attorney for the Northern District of Illinois, said in a statement. “False documentation of treatment is not just flawed patient care; it is illegal.”

The federal government got involved in the case after it was brought to a court by a whistleblower, Bijan Oughatiyan, MD, who worked at IPC in San Antonio from 2003 to 2008. As part of the settlement, he’ll personally receive $11.8 million.

Besides the fine, TeamHealth agreed to a corporate integrity agreement with HHS’s Office of the Inspector General (OIG). Covering the company’s hospital medicine division, the agreement will aim to “increase TeamHealth’s accountability and transparency so that the company will avoid or promptly detect future fraud and abuse.”