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New Jersey hospital settles whistleblower suit

Warren Hospital in Phillipsburg, N.J., will pay the United States $7.5 million to settle allegations that it defrauded Medicare. The suit, which originated as a whistleblower suit under the qui tam provisions of the federal False Claims Act, alleged that the hospital improperly increased charges to Medicare patients in order to obtain enhanced reimbursement from Medicare. The hospital allegedly inflated charges for patient care in order to collect supplemental payment under Medicare’s outlier payment system. That program was introduced to ensure that
hospitals possess the incentive to treat inpatients whose care requires unusually high costs.

Earthtimes reported on December 10, 2007 that the relators in the first lawsuit brought against Warren will share a reward of $1.6 million.

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