The Department of Justice today reached 70 settlements totaling more than $250 million involving 457 hospitals in 43 states to resolve allegations that these hospitals implanted cardiac devices in Medicare patients in violation of Medicare coverage requirements.

“In terms of the number of defendants, this is one of the largest whistleblower lawsuits in the United States and represents one of this office’s most significant recoveries to date,” said U.S. Attorney Wifredo Ferrer of the Southern District of Florida. “Our office will continue to vigilantly protect the Medicare program from potential false billing claims.”

Medicare coverage for the cardiac device, which costs approximately $25,000, is governed by a National Coverage Determination (NCD). Only patients with certain clinical characteristics and risk factors qualify for the so-called “implantable cardioverter defibrillator” (ICD) device covered by Medicare. 

The NCD provides that ICDs generally should not be implanted in patients who have recently suffered a heart attack or recently had heart bypass surgery or angioplasty. The NCD expressly prohibits implantation of ICDs during a specific waiting period—40 days for a heart attack and 90 days for bypass/angioplasty—to give the heart an opportunity to improve function on its own to the point that an ICD may not be necessary. The Department of Justice alleged that from 2003 to 2010, each of the settling hospitals implanted ICDs during the periods prohibited by the NCD.  

The largest settlement amounts include the following:

HCA Holdings (Hospital Corporation of America) and its 42 affiliated hospitals to pay $15.8 million;

Ascension Health and 33 of its affiliated hospitals to pay $14.5 million;

Community Health Systems and its 31 affiliated hospitals to pay $13 million; and

Catholic Health East and its 13 affiliated hospitals to pay $11 million.

Most of the settling defendants were named in a whistleblower lawsuit brought under the False Claims Act, which permits private citizens to bring lawsuits on behalf of the United States and receive a portion of the proceeds of any settlement or judgment awarded against a defendant. The lawsuit was filed in federal district court in the Southern District of Florida by Leatrice Ford Richards, a cardiac nurse, and Thomas Schuhmann, a health care reimbursement consultant.  The whistleblowers have received more than $38 million from the settlements. The Justice Department said it’s continuing to investigate additional hospitals and health systems.

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