New Jersey University Hospital to Pay Additional $2 Million to Resolve Fraud Claims That Facility Double Billed Medicaid

WASHINGTON - The University of Medicine and Dentistry of New Jersey (UMDNJ) has agreed to pay the United States $2 million to resolve federal civil fraud allegations that its hospital defrauded Medicaid, the Justice Department announced today. From 1993 to 2004, UMDNJ’s University Hospital submitted claims to Medicaid for outpatient physician services that were also being billed by doctors working in the hospital’s outpatient centers. By submitting duplicate claims for payment, University Hospital effectively doubled billed the government’s Medicaid program.

"Today’s settlement demonstrates that the Department of Justice will not tolerate fraud on our Medicaid programs, which were created to serve our nation’s low-income families, children and seniors," said Tony West, Assistant Attorney General for the Justice Department’s Civil Division. "We will continue to work with our partners at the Department of Health and Human Services Inspector General’s Office to protect the integrity of our public health programs."

The case against UMDNJ and University Hospital originated in a qui tam or whistleblower complaint filed under the Federal False Claims Act by Dr. Steven Simring. In late 2005, the double billing addressed by today’s settlement was also the subject of a criminal complaint filed against UMDNJ by the U.S. Attorney’s Office for the District of New Jersey. As a result of a Deferred Prosecution Agreement concerning that criminal complaint, the state of New Jersey previously recouped $4.9 million from University Hospital, half of which was to be returned to the federal Medicaid program.

Under the terms of today’s agreement, UMDNJ will pay an additional $2 million to the federal government to resolve the outstanding civil federal false claims act allegations. The total federal recovery when combined with the previous payment is $4.45 million. Dr. Simring will receive $801,000 as his share of the total federal recovery.

The Office of the Inspector General of Department of Health and Human Services worked with the Justice Department’s Civil Division to obtain today’s result.