Se­lect Med­i­cal agrees to set­tle whis­tle-blower case

Modern Healthcare - - LATE NEWS -

Se­lect Med­i­cal Hold­ings Corp., which op­er­ates 81 spe­cialty and long-term acute­care hos­pi­tals in states across the coun­try, has agreed to set­tle fraud al­le­ga­tions and en­ter a cor­po­rate in­tegrity agree­ment. HHS’ in­spec­tor gen­eral’s of­fice pub­lished the five-year in­tegrity agree­ment, while records on file in the U.S. District Court in Colum­bus, Ohio, show the com­pany has agreed to pay an undis­closed sum to re­solve the al­le­ga­tions of a former em­ployee, Beatrix Mait­land. Mait­land al­leged in a False Claims Act law­suit in 2007 that Se­lect made clin­i­cal de­ci­sions on pa­tients’ lengths of stays in re­ha­bil­i­ta­tion hos­pi­tals based on weekly re­ports on pa­tients’ in­sur­ance re­im­burse­ments, re­gard­less of med­i­cal need. The govern­ment re­cently in­ter­vened in some of Mait­land’s claims, but the court records that stip­u­late ex­actly which claims re­mained un­der seal. The mo­tion did not re­veal the set­tle­ment amount. Nei­ther the Jus­tice Depart­ment nor the com­pany would pro­vide the agree­ment. In an Au­gust fil­ing with the Se­cu­ri­ties and Ex­change Com­mis­sion, Se­lect said it recorded a pre­tax charge of $7.5 mil­lion to es­tab­lish a set­tle­ment re­serve that rep­re­sents the com­pany’s “best es­ti­mate of a prob­a­ble set­tle­ment.” The com­pany would not com­ment on the al­le­ga­tions. “We can­not dis­cuss this is­sue, but we can say that we have a ro­bust com­pli­ance pro­gram aimed at con­tin­u­ous im­prove­ment of our com­pli­ance prac­tices,” com­pany spokesman Ed­win Bo­den­siek said in an e-mail.

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