News and Press Releases

Community Hospital Pays $451,428.00 To Resolve Allegation Of Improper Claims

Friday, August 30, 2013

HONOLULU - Wahiawa General Hospital ("WGH") of Honolulu, Hawaii, shall pay $451,428.00 to settle two lawsuits alleging that WGH improperly billed the Medicare program, the State of Hawaii Medicaid program, and TRICARE, the federal health benefits program for military dependents. The settlement grew out of civil "whistleblower" lawsuits brought under the federal and State of Hawaii False Claims Acts in federal and state court by a doctor who had worked at the Physicians Center at Mililani (“PCM”), an out-patient clinic operated by WGH. The doctor alleged that WGH had submitted bills to Medicare and Medicaid programs for services provided by resident doctors without the level of supervision required by federal law. The federal and state governments initiated an investigation based upon the doctor’s allegations.

According to the settlement agreement signed on August 29, 2013, the federal and state governments alleged that WGH wrongfully submitted claims to the Medicare, Medicaid, and TRICARE programs for services provided to federal beneficiaries at WGH and PMC, during the time period from April 1, 2008, through March 31, 2011, by resident doctors participating in the Family Practice Residency Program (“FPRP”) sponsored by the John A. Burns School of Medicine, without satisfactory documentation of the required supervision by the FPRP’s teaching faculty or where the coding of services performed could not be confirmed by the doctors’ entries in the patients’ medical records. While WGH agreed to the settlement, it did not admit liability. Under the terms of the settlement agreement, WGH shall pay the federal government a settlement payment of $451,428.00. WGH also agreed to pay $75,000.00 in attorney’s fees and costs to the attorneys who represented the doctor.

Florence T. Nakakuni, United States Attorney for the District of Hawaii, noted that under the federal False Claims Act, the United States can seek up to triple damages, plus penalties, for false and fraudulent claims for payment that are submitted to government programs. To encourage assistance from the public, the False Claims Act allows private persons bring civil lawsuits on behalf of the government and to receive a share of any damages recovered through the lawsuit if the person substantially contributes to the successful prosecution of the action. In this case, the doctor who initiated the lawsuits will receive $84,642.75 of the $451,428.00 settlement payment. Nakakuni praised the doctor for his courage in coming forward and reporting the alleged wrongdoing, and expressed appreciation for the efforts of his attorneys, Margery Bronster, Esq., and Sunny Lee, Esq., both of Honolulu.

Wade McFaul, Assistant Special Agent in Charge for the U.S. Department of Health and Human Services, Office of Inspector General region including Hawaii, stated: "We will work tirelessly to protect the taxpayers and these vitally important federal health care programs. Working with law enforcement partners, our investigators, auditors and attorneys uncovered evidence that WGH allegedly submitted bills to Medicare for services performed by resident doctors without properly documenting the required supervision."

Nakakuni also credited the Office of Audit Services, Office of Inspector General, U.S. Department of Health and Human Services, for providing critical audit support. The investigation was jointly conducted by the Office of Investigations, Office of Inspector General, U.S. Department of Health and Human Services, the Defense Criminal Investigative Service, and the State of Hawaii Attorney General's Medicaid Investigations Division. The case was handled by Assistant U.S. Attorney Rachel Moriyama, Senior Counsel Gregory Wellins of the Office of Counsel to the Inspector General, U.S. Department of Health and Human Services, and Deputy Attorney Generals Michael Parrish and Gary Senaga of the Medicaid Investigations Division, Department of the Attorney General, State of Hawaii.

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