The Department of Justice today announced a $34 million settlement involving fifty-five hospitals that are alleged to have overcharged Medicare for kyphoplasty procedures. Kyphoplasty is a minimally invasive operation involving the injection of bone cement to repair spinal fractures. Although kyphoyplasty is frequently performed as an outpatient procedure, the hospitals involved in this week’s settlement allegedly billed the procedure at the higher inpatient rate in order to pad their Medicare billings. The case began as a qui tam suit brought under the False Claims Act by two employees of Kyphon, Inc., the major supplier of kyphoplasty equipment. The whistleblowers will receive roughly $5.5 million from this week’s settlement.

Today’s settlements are only the most recent in a string of settlements stemming from the whistleblower suit: the government has now collected over $75 million from more than 100 hospitals on related allegations. And in 2008 the government settled its case against the corporate successor of Kyphon for another $75 million based on allegations that the company improperly advised hospitals to perform the procedure on an inpatient rather than outpatient basis.

Read the entire press release, “Fifty-Five Hospitals to Pay U.S. More Than $34 Million to Resolve False Claims Act Allegations Related to Kyphoplasty”
Read our earlier post on the case, “14 Hospitals to Pay Over $12 Million for FCA Violations”