Quorum agrees to $18 million Medicare settlement

Quorum Health Group Inc. of Brentwood, TN, and its subsidiary, QHG of Alabama Inc., have agreed to pay $18 million to settle claims that they defrauded the Medicare Program from 1988 to 1998, the U.S. Department of Justice announced Oct. 27.

The civil settlement resolves allegations that Quorum and Flowers Hospital defrauded Medicare by shifting costs to Home Care Services (HCS), a home health agency owned by Quorum and Flowers Hospital, and improperly used HCS to bill Medicare for unallowable costs.

The government alleged that Quorum and Flowers Hospital shifted costs from the hospital to HCS by improperly charging hospital costs on HCS’ Medicare cost report.

As a result, the government says, Quorum and Flowers Hospital received excessive reimbursement from Medicare, including hospital employee salaries and benefits, costs of the hospital’s physical therapy department, and hospital medical malpractice insurance premiums.