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Arizona hospitals to pay $35M to settle false claims

TUCSON, Ariz. — Federal authorities say an Arizona nonprofit corporation
has agreed to pay $35 million to resolve allegations that two of its Tucson
hospitals submitting false claims to Medicare and other federal health care
programs for nearly seven years.

The Carondelet Health Network does business in Tucson as Carondelet St. Mary’s
Hospital and Carondelet St. Joseph’s Hospital.

Prosecutors say the two hospitals billed Medicare, the Federal Employees Health
Benefit Program and the Arizona Health Care Cost Containment System for
inpatient rehabilitation facility services that weren’t properly reimbursable.

They say the patients weren’t appropriate for inpatient rehabilitation facility
services.

Prosecutors say the settlement resolves false claim allegations from the
hospitals from April 7, 2004 through Dec. 31, 2011.

They say it also resolves a whistleblower’s lawsuit that was filed in November
2011.

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