Columbia suit far from over, experts say
Columbia suit far from over, experts say
Columbia/HCA Healthcare’s tentative $745 million agreement with the U.S. Department of Justice (DOJ) to settle civil claims against the company leaves the case far from settled, according to several experts.
"I think the most interesting part of the story is waiting to happen between now and Dec. 31," asserts health care attorney Steven Meagher of Phillips, Cohen in San Francisco, referring to the government’s self-imposed deadline to settle the outstanding issues or potentially lose the $745 million Columbia already has agreed to.
"The whole structure of the agreement is almost unprecedented," says Meagher. He adds the agreement basically takes three of the five issues that Columbia was under investigation for — diagnosis-related group (DRG) coding, outpatient laboratory billing and home health — and attaches a value to them of $745 million. But the tentative deal sets that aside and links it to resolution of the criminal investigations still pending. And the big-ticket item still pending is the cost-report investigation.
"That is what the FBI has been interested in from the beginning," asserts Meagher. He points out that the criminal cases that have gone to trial and resulted in convictions have all been cost-reporting claims. "That leaves a huge potential claim hanging out there."
He says the cost-reporting claims have widely been perceived as the largest simply because that issue involves all the hospitals Columbia owned for 10 years. "You are talking about over 300 hospitals and over 3,000 cost reports," he asserts. "It does not take very long to do the math."
He notes that in an earlier trial, there was a single item concerning a hospital that was worth $3.5 million. Typically, he says, there are 15 to 20 items at issue on any given reserve each year for each hospital.
Meagher says the agreement gives both sides an incentive to resolve the outstanding issues. "It’s designed as a substantial first step that provides the right incentives to getting the rest of it done."
The settlement is still subject to approval by others at DOJ, as well as implementation of a corporate integrity agreement (CIA). Columbia also reached an understanding with the Department of Health and Human Services’ Office of Inspector General on the terms of the CIA that cover DRG coding, laboratory billing, and the civil issues still to be resolved — physician relations and cost reports.
Execution of the CIA would result in a waiver of the government’s discretionary right to exclude any of the company’s operations from participation in the Medicare program. The agreement also provides that any future civil payments on cost reports or physician relations will reduce the remaining amount of the letter of credit dollar for dollar.
Specifically, the agreement covers DRG coding from 1990 to 1997; outpatient laboratory from 1989 to 1997; home health community education for Medicare cost report years 1994 to 1997; home health billing from 1995 to 1998; and certain home health management transactions, including Olsten for Medicare cost report years 1993 through 1998. Columbia has been in negotiations with DOJ since mid-1997.
Subscribe Now for Access
You have reached your article limit for the month. We hope you found our articles both enjoyable and insightful. For information on new subscriptions, product trials, alternative billing arrangements or group and site discounts please call 800-688-2421. We look forward to having you as a long-term member of the Relias Media community.