Massachusetts-based MedStar Ambulance, four subsidiary companies, and two owners have agreed to pay $12.7 million to resolve a whistleblower lawsuit accusing the company of inflating charges billed to Medicare and falsely billing it for unnecessary medical transport services.
Worcester-based MedStar, which has operations throughout Worcester County and the MetroWest area, routinely billed Medicare for transportation services that did not qualify for reimbursement because they were “not medically reasonable and necessary,” the U.S. Department of Justice claimed in the lawsuit.
The company also billed Medicare for higher levels of services than were required by patients’ conditions, and for services that were never actually provided, federal prosecutors alleged.
The settlement ends a four-year investigation launched by a False Claims Act lawsuit filed by Dale Meehan, a former Medstar billing employee. Ms. Meehan filed the lawsuit on behalf of the federal government in 2013.
“We expect those who participate in the Medicare program to provide services, including ambulance services, based on the medical needs of patients rather than their desire to maximize profits,” said Benjamin Mizer, Principal Deputy Assistant Attorney General and head of the Justice Department’s Civil Division. “The Department of Justice is committed to ensuring that those who abuse the Medicare program will be held accountable for their actions.”
The U.S. alleged that MedStar unlawfully billed Medicare from Jan. 1, 2011, through Oct. 31, 2014, resulting in the taxpayer-funded program overpaying by millions of dollars for ambulance services.
Ms. Meehan will receive approximately $3.5 million of the total settlement as a whistleblower award, the Justice Department said.
Source: U.S. Department of Justice