Federal prosecutors say that Rex Healthcare in Raleigh, NC has agreed to pay nearly $2 million to settle allegations it overbilled Medicare by ordering higher-cost services for patients who only needed outpatient treatment. The Justice Department said Monday that between 2004 and 2007, Rex Healthcare billed Medicare for inpatient admissions to increase what it could charge for the spinal surgery procedure, kyphoplasty. The allegations came to light as the result of a whistleblower lawsuit filed in Buffalo, N.Y. related to a procedure that treats spinal fractures called.”
When Rex Healthcare did not admit liability when they agreed to settle whistle-blower allegations, and investigators did not concede that their claims were ill-founded by accepting the payment, according to the settlement. A spokesperson for Rex Healthcare stated that the hospital settled the case to avoid the cost of litigating the allegations, and alleged that the hospital was following the regulations that were in place until 2007.