Skyline Urology Agrees to Pay the United States $1.85 Million to Resolve False Claims Act Allegations of Overbilling Medicare

BALTIMORE, Maryland, Feb. 25 -- The U.S. Attorney for the District of Maryland, Robert K. Hur, issued the following news release:

Skyline Urology has agreed to pay the United States $1,850,000 to resolve claims under the False Claims Act alleging that Skyline submitted false claims to Medicare by billing for evaluation and management (E&M) services that were not eligible for reimbursement. Skyline provides urology care in the South Bay area in Southern California with headquarters located in Torrance, California. The false claims act case was filed in U.S. District Court in Maryland, since Medicare claims were paid in Maryland.

The settlement agreement was announced today by the United States Attorney for the District of Maryland, Robert K. Hur; Assistant Attorney General Jody Hunt of the Justice Department's Civil Division, and Special Agent in Charge Maureen Dixon of the Office of Inspector General for the Department of Health and Human Services.

"The U.S. Attorney's Office for the District of Maryland is committed to thoroughly investigating claims of fraud and holding health care providers accountable when they break the rules," said U.S. Attorney Robert K. Hur. "This settlement is an example of how whistleblowers and government can work together to recoup funds and deter overbilling practices."

"Physicians and practice groups are expected to bill Medicare properly for the services they provide," said Assistant Attorney General Jody Hunt of the Department of Justice's Civil Division. "Today's settlement sends a clear message that the Department of Justice will hold healthcare providers accountable if they knowingly overbill federal healthcare programs."

Skyline presents claims to and is paid by health insurance plans, including Medicare. The amount payable by insurers for a procedure includes the cost of evaluating a patient for the procedure, therefore, under most circumstances, health care providers are not permitted to bill for E&M services on the same day a related procedure is performed. An exception applies, however, if the E&M service is distinctly separate from other services provided, or if the E&M service is above and beyond the care usually associated with the procedure itself. Under these circumstances, a provider may bill for both the E&M service and the procedure, and does this by submitting the bill with a special code, that permits both claims to be paid. Utilizing the code incorrectly results in overbilling.

According to the settlement agreement, the United States contends that from January 1, 2013, through December 31, 2016, Skyline improperly used the code to falsely claim that E&M services were unrelated to other procedures performed on the same day on the same patient, and thus, eligible for separate reimbursement. In fact, the E&M services were performed as part of, and in connection with, other procedures performed on the same day on a single patient, and Skyline received more reimbursement than it was entitled to under Medicare. Skyline denies the allegations.

Skyline Urology has also entered into an Integrity Agreement with the U.S. Department of Health and Human Services, Office of Inspector General that will require regular monitoring of its billing practices for three years.

"Providers are expected to closely follow Medicare rules and bill properly -- nothing more, nothing less," said Maureen R. Dixon, Special Agent in Charge of the Office of Inspector General of the U.S. Department of Health and Human Services. "Taxpayer money wasted is money stolen from this vital federal health program."

The civil settlement resolves a lawsuit filed under the whistleblower provision of the False Claims Act by James M. Cesare (United States and State of California ex rel James M. Cesare v. Skyline Urology., Civil Case No. JKB-16-4059 (D. Md.)). The False Claims Act permits private parties to file suit on behalf of the United States for false claims and obtain a portion of the government's recovery. As part of today's resolution, Mr. Cesare will receive $323,750. The claims resolved by this settlement are allegations only, and there has been no determination of liability.

U.S. Attorney Robert K. Hur commended the HHS Office of Inspector General for its work in the investigation. The case was handled by Assistant United States Attorneys Jane Andersen and Thomas Corcoran, and Trial Attorney Nicolas Perros of the Department of Justice Civil Fraud Section.