Minnesota hospital settles for $500K over false Medicare claims

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A Minnesota hospital is among the 32 across the nation who have agreed to a $28 million settlement with the Justice Department over allegations they submitted false claims to Medicare.

St. Cloud Hospital has agreed to pay $500,000 after it was implicated in the mischarging scandal concerning kyphoplasty procedures, which according to a Justice Department release has so far seen more than 130 hospitals settle for a combined $105 million.

They are accused of frequently billing Medicare for kyphoplasty – a "minimally invasive" procedure to treat certain spinal fractures – on an inpatient rather than an outpatient basis, increasing their payments from Medicare.

The Justice Department said in most cases it can be done as an outpatient procedure safely and effectively.

"Charging the government for higher cost inpatient services that patients do not need wastes the country’s vital health care dollars," Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division, said.

"The Department of Justice is committed to ensuring that Medicare funds are expended appropriately, based on the medical needs of patients rather than the desire to maximize hospital profits."

In 2008, the Justice Department agreed a $75 million settlement with Medtronic Spine LLC (part of Minnesota-based Medtronic Inc.), which was the corporate successor to Kyphon Inc.

Kyphon was alleged to have counseled hospital providers to treat those requiring kyphoplasty as inpatients and not outpatients.

According to Spine Health, kyphoplasty surgery is designed to stop pain caused by spinal fractures and stabilize the bone by injecting a cement-like material into spinal cavities via a small incision in the back.

It is commonly required among those who suffer from osteoporosis.

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