$41.8M Medicare fraud settlement in Tennessee whistleblower suit

$41.8M Medicare fraud settlement in Tennessee whistleblower suit

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KNOXVILLE (WATE) - Medical equipment supplier Hill-Rom agreed Tuesday to pay $41.8 million in a Medicare fraud settlement after a lawsuit by two Tennessee whistleblowers.

It's the largest civil fraud recovery ever by the U.S. Attorney's Office for the Eastern District of Tennessee.

"Health care fraud or false claims have become a very serious problem," said U.S. Attorney Bill Killian during a news conference Tuesday.

Former Hill-Rom senior account managers Lisa Brocco, of Nashville, and Laurie Salmons, of Knoxville, filed their sealed complaint in Knoxville in April 2005.

The women said they learned Hill-Rom was receiving Medicare payments for specialized equipment - bed support surfaces for treatment of pressure ulcers or bed sores- on patients who didn't qualify for the program.

In some cases, claims continued to be submitted although patients had died or were no longer using the equipment, the lawsuit contended.

The payment Hill-Rom agreed to in the settlement compensates the Medicare trust fund for the moneys it paid, claimed and received from 1999 through 2007, according to the Department of Justice.

Hill-Rom also entered into a comprehensive five-year Corporate Integrity Agreement with the U.S. Department of Health and Human Services, Office of Inspector General to ensure future compliance with federal health care benefit program requirements.

When the suit was filed, Salmons was laid off and Brocco was still employed. Brocco continues to work for the company.

Whistleblowers can receive an award for exposing fraud. Brocco and Salmons will share an award of $8.36 million. The women were represented by attorney David Burkhalter, of Knoxville.

Hill-Rom is one of the largest national medical equipment suppliers. It's headquartered in Batesville, Indiana. It has a national presence including offices in Knoxville and the surrounding area.

The company released a statement Tuesday that says in part:

"Hill-Rom is dedicated to the highest standards of business conduct and integrity. We vigorously disagree that there was any wrongdoing in this situation and this settlement does not represent any admission on our part. We remain committed to adherence with all applicable laws and regulations. Hill-Rom recognized a charge for this matter as previously announced in our fiscal third quarter earnings report."

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