UNITED STATES FILES SUIT AGAINST TENET HEALTHCARE
ALLEGING FALSE CLAIMS BILLINGS TO MEDICARE

WASHINGTON, D.C.– The Justice Department filed suit today against Tenet HealthCare alleging that the nation's second largest for-profit hospital chain submitted fraudulent claims to Medicare. The government filed the action against the Santa Barbara, California-based chain in Los Angeles, California.

The case brought on behalf of Medicare alleges that Tenet and its hospitals violated the False Claims Act by upcoding in-patient claims submitted to the federal health care program for reimbursement. Upcoding is the practice of improperly assigning a diagnosis code to a patient discharge that is not supported by the medical record for the purpose of obtaining a higher level of reimbursement for that hospital discharge than the hospital would otherwise receive.

Because Medicare bases its reimbursements to hospitals on patients' diagnoses, the United States alleges that Tenet manipulated the coding process to enhance revenues. The action focuses upon upcoding of pneumonia and septicemia claims, as well as certain respiratory claims with mechanical ventilation.

Most of the alleged upcoding at issue took place during a time when Tenet was under a Corporate Integrity Agreement with the Department of Health and Human Services. One of the central issues in the case involves allegations that Tenet, pursuant to its Corporate Integrity Agreement, falsely certified to the government that it was in compliance with the Medicare regulations and the terms of the Corporate Integrity Agreement, when in fact, it knew of a significant number of upcoded claims that had been submitted to the Medicare program and for which Tenet had never, and still has not, made restitution to Medicare. In January, 2000, Tenet settled upcoding allegations with respect to one of its hospitals, Columbia Regional Medical Center, located in Columbia, Missouri.

The suit is entitled United States v. Tenet Healthcare Corp., et al.(CV-03-206 GAF)

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