The University of Missouri on Thursday agreed to pay $5.2 million to settle claims in a medical billing whistleblower case taken over by federal prosecutors and to settle other billing problems identified during an internal investigation of the fraud.
The fraud settlement, reported in a news release Thursday by U.S. Attorney Tammy Dickinson, will cost MU Health Care $2.2 million for the actions of Michael Richards and Kenneth Rall, radiologists who were fired by the university in 2012. An additional $3 million, reported in a news release from MU Health Care, will cover improper billing for tests and treatments and other issues.
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Rall and Richards also are defendants in the case, initially filed by Alvin Galuten, who in 2010 was a fellow and part-time faculty member in clinical radiology at the MU School of Medicine. Pending settlements of claims against Rall and Richards would require Rall to pay $1.5 million and Richards to pay $375,000.
Rall also has agreed to plead guilty to a health care fraud charge in federal court and surrender his medical license, according to a motion filed by federal prosecutors in March. Negotiations with Richards over a criminal plea were still underway at the time.
The settlements with Rall and Richards are being challenged by Galuten, who could receive a share of whatever they pay. Those settlements were waiting for the agreement with MU to be completed and Galuten's issues to be resolved before being finalized, attorney Harvey Tettlebaum, who represents Rall, said Friday. "That is why there hasn't been anything publicly announced until now," he said.
Rall and Richards committed billing fraud, the complaint alleged, by allowing resident physicians to perform services the radiologists were supposed to do, violating Medicare and hospital rules. Under federal regulations, attending physicians cannot bill for reviewing images associated with interpretive reports unless they have actually reviewed the images.
"Hospitals and physicians have the highest obligation to both protect patients by complying with the standard of care and to protect taxpayers by complying with the rules for billing federal programs," Dickinson said in the news release. "This lengthy investigation by multiple agencies working together has produced a just result for both patients and taxpayers."
The investigation revealed Rall and Richards sometimes claimed they had completed the review without actually looking at the image, practices that continued from at least March 2010 until November 2011, according the news release from MU Health Care.
The investigation identified 30 patients out of 14,164 whose images might not have been reviewed by Rall or Richards. MU Health attempted to notify those patients to arrange follow-up exams with assistance from investigative firm Clarence Kelley & Associates and federal authorities. Five of the patients could not be located, MU Health said in the news release.
An independent expert also reviewed the images and the diagnosis made at the time the patient was treated, interim Chancellor Hank Foley said in a news release.
The billing fraud case covered charges billed to Medicare, Medicaid and TRICARE, the health insurance program for military personnel.
"We consider these settlements to be a fair resolution," Foley said in a news release from MU Health Care.
Foley also is interim executive vice chancellor for health affairs.
The federal investigation commenced in 2011 and led to an internal investigation by the university. During the university's review, MU Health found that from 2001 to 2013, the health system had not properly billed for two tests and treatments and failed to fully document agreements under the Physician Self-Referral Law, which prohibits physicians from making referrals for certain Medicare-billed services to an entity with which he or she has a financial relationship.
The findings of the internal review led to the $3 million payment reported Thursday.
The university has been setting aside money in its budget to repay the federal government, the MU Health news release said.
This article was first published online on Thursday, June 30, 2016 at 5:53 p.m.
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Source: University of Missouri pays $5.2 million to settle problems with medical billing
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