Clearwater, Fla.-based BayCare Health System has agreed to pay the U.S. $20 million to resolve allegations that it violated the False Claims Act, the Justice Department announced April 6.
The settlement resolves allegations that the health system made donations to the Juvenile Welfare Board of Pinellas County (Fla.) to improperly fund the state's share of Medicaid payments to BayCare.
Prosecutors alleged that BayCare made donations to the Juvenile Welfare Board knowing that a portion of the funds would be transferred to Florida's Agency for Health Care Administration for the state's Medicaid program.
"The funds transferred by JWB to the state were 'matched' by the federal government before being returned to the BayCare hospitals as Medicaid payments, and BayCare was thus able to recoup its original donations to JWB and also receive federal matching funds, in violation of the federal prohibition on non-bona fide donations," the Justice Department said.
The claims against BayCare were originally brought under the qui tam, or whistleblower, provisions of the False Claims Act by a former hospital reimbursement manager.