Diakon Lutheran Social Ministries to pay $10.56 million settlement

By Michael P. Tremoglie | Dec 4, 2011

Allentown's Diakon Lutheran Social Ministries, which operates as Diakon Hospice Saint John (Diakon), reached a settlement for violations of the False Claims Act (FCA) by paying the U.S. government $10.56 million, the U.S. Attorney’s Office announced.

Earlier this year, Diakon voluntarily disclosed to federal authorities that it had received improper Medicare and Medicaid payments.

Diakon erroneously submitted claims to the Medicare program for hospice care provided to Medicare beneficiaries from Oct. 1, 2004 through Oct. 1, 2010, despite the beneficiaries being ineligible for hospice benefits under the Medicare regulations.

Diakon avoided a government lawsuit under the FCA because it voluntarily disclosed the improper billing practices. The FCA provides that parties who voluntarily disclose violations are liable for double damages, instead of triple damages and civil penalties between $5,500 and $11,000 for each violation.

The settlement agreement does not release claims under any federal health care program other than Medicare. Diakon will repay directly to Medicaid the relatively small Medicaid overpayment that it disclosed.

“Health care providers that make billing compliance, self- policing, and self reporting a priority foster trust in the health care industry,” said Nick DiGiulio, Special Agent in Charge for the United States Department of Health and Human Services' Office of Inspector General. “These actions demonstrate that Diakon Hospice Saint John cares about returning money, incorrectly attained, to our federal health payment programs.”

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