14 Hospitals Pay $12M to Settle Medicare Fraud Charges Surrounding Spinal Surgery Billing

Financial Management

By: OSD Staff

Published: 2/8/2012

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Arrangements follow federal government's continuing kyphoplasty investigations.


Fourteen hospitals in 7 states have agreed to pay the federal government $12 million to settle charges of fraudulent Medicare billing for a type of spinal surgery.

According to the U.S. Department of Justice, the following hospitals will share in the restitution for the latest round of settlements on this issue:

  • Plainview Hospital, Plainview, N.Y.: $2.3 million
  • North Mississippi Medical Center, Tupelo, Miss.: $1.9 million
  • Mission Hospital, Asheville, N.C.: $1.5 million
  • Wenatchee Valley Medical Center, Wenatchee, Wash.: $1.2 million
  • Community Hospital Anderson, Anderson, Ind.: $501,000
  • St. John's Mercy Hospital, Creve Coeur, Mo.: $365,000
  • North Shore Syosset Hospital, Syosset, N.Y.: $193,000
  • Gulf Coast Hospital, Fort Myers, Fla.: $173,000
  • Lee Memorial Hospital, Fort Myers, Fla.: $160,000
  • Cape Coral Hospital, Cape Coral, Fla.: $73,000

    Four Florida hospitals affiliated with Adventist Health System/Sunbelt, Inc., will jointly pay $3.9 million:

  • Florida Hospital Orlando
  • Florida Hospital-Oceanside
  • Florida Hospital Fish Memorial
  • Florida Hospital Heartland Medical Center

    As in previous settlement agreements, the hospitals were accused of performing kyphoplasties, spinal fracture repair procedures that are often performed on an outpatient basis, as inpatient cases in order to bill Medicare for higher reimbursements.

    More than 40 hospitals have paid $39 million to settle federal investigations into fraudulent kyphoplasty billing activities, which took place between 2000 and 2008, according to a published report.

    The investigations began in 2008 when former employees of a subsidiary of medical device manufacturer Medtronic Spine alerted the government that their company had been recommending the practice of converting outpatient kyphoplasties into inpatient cases for profit.

    That year, Medtronic signed a $75 million settlement with the Justice Department over the issue.

    David Bernard

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