Charlotte, N.C.-based Carolinas Healthcare System agreed to pay the federal government $6.5 million to settle a lawsuit alleging the health system violated the False Claims Act, according to the Department of Justice.
The government accused Carolinas Healthcare of submitting improperly coded claims to government payers from 2011 to 2015. Specifically, the government alleged the health system categorized urine drug tests as "high complexity" when the claims should have been categorized as "moderate complexity." Carolinas Healthcare received $80 more per test for the claims submitted to government payers with the higher paying code, according to the DOJ.
A former laboratory director for Carolinas Healthcare originally brought the allegations against the system in a lawsuit filed under the qui tam, or whistle-blower, provisions of the False Claims Act.
"CHS has fully cooperated in the government's review of this matter, but after almost two years we determined it was in our best interest to move forward and resolve this issue," Carolinas Healthcare said in an e-mailed statement. "The $6.5 million amount that CHS is paying to resolve this matter accounts, in part, for the difference between what CHS was reimbursed for the drug screens, and what Medicare and Medicaid alleges that CHS should have been reimbursed had it used a different code. We are pleased to put this matter behind us so that we can continue focusing on providing the expert level of care that our patients and community demand and desserve."
More articles on healthcare industry lawsuits:
10 latest healthcare industry lawsuits, settlements
LA hospital operator to pay $42M to settle physician kickback case
Shuttered NC hospital to pay $1M to settle lawsuit over improper layoff notifications
Editor's note: This article was updated July 5 to include Carolinas Healthcare System's statement.