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TeamHealth to pay $60 million to settle 'upcoding' claims as acquisition by Blackstone wraps up

DOJ alleged that subsidiary IPC pressured physicians to bill for higher levels of service than what was provided.

Beth Jones Sanborn, Managing Editor

TeamHealth Holdings, nationwide hospital staffing provider and owner of group practice IPC Healthcare, has agreed to pay $60 million plus interest to settle allegations that IPC engaged in a prolonged scheme of billing Medicare, Medicaid, the Defense Health Agency and the Federal Employees Health Benefits Program for more expensive medical services that were actually provided, the Department of Justice announced. 

TeamHealth is comprised of more than 20,000 affiliated physicians and advanced practice clinicians and offers outsourced emergency medicine, hospital medicine, critical care, anesthesiology, orthopedic hospitalist, acute care surgery, obstetrics and gynecology hospitalist, and other services to approximately 3,300 acute and post-acute facilities and physician groups across the country.

According to the DOJ, the government alleged that IPC put corporate pressure on physicians to "upcode" claims to maximize billing, especially pressuring physicians with lower billing levels.

[Also: Physician services firm TeamHealth bought by Blackstone for $6.1 billion.]

TeamHealth also agreed to increase accountability and transparency in order to avoid any future fraud, according to the settlement.

The allegations stem from a whistleblower lawsuit filed in a Chicago federal court by Bijan Oughatiyan, a physician formerly employed by IPC as a hospitalist. Under the False Claims Act, the government was allowed to intervene and take over the suit, as it did in this case. Oughatiyan will receive about $11.4 million, which is his share of the recovery as allowed under the False Claims Act.

The acquisition of TeamHealth by funds affiliated with global asset manager Blackstone and certain other investors, wrapped up Monday, making TeamHealth a privately held company.

Twitter: @BethJSanborn

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