Bethlehem, Pa.-based St. Luke's University Health Network filed a proposed class-action lawsuit against Lancaster (Pa.) General Hospital on May 22, alleging Lancaster General submitted hundreds of inaccurate and overstated claims to the state's Extraordinary Expense Fund, which compensates hospitals for their charity care.
According to the complaint, the Pennsylvania Auditor General found approximately 75 percent of all claims Lancaster General submitted to the EE program were invalid from fiscal year 2010 through fiscal year 2012. This rate of invalid claims was about 7.5 times higher than at other hospitals.
St. Luke's alleges Lancaster General was overpaid by nearly $9 million from the EE program between fiscal years 2010 and 2012.
"Given that only about $32.5 million in EE Program funds were distributed to hospitals during those three years, this means that more than one out of every four dollars disbursed during the relevant time period was improperly disbursed to Lancaster General," states the complaint.
The alleged overpayments to Lancaster General lowered reimbursements to other hospitals, including those in St. Luke's system.
Lancaster General told Law360 St. Luke's allegations are meritless.
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