published Wednesday, September 28th, 2011

Medical supplier to pay $41 million to settle fraud case

One of the nation’s biggest suppliers of medical beds has agreed to pay $41.8 million after reportedly making false claims from 1999 to 2007 about the need for Medicare-paid equipment.

Hill-Rom Co. Inc. denied any wrongdoing Tuesday, but the Batesville, Ind.-based company said the settlement would end a six-year legal dispute over Medicare payments.

The U.S. attorney for the Eastern District of Tennessee, Bill Killian, said Hill-Rom knowingly submitted repeated false claims for specialized medical equipment used for treatment of bed sores when patients did not qualify under Medicare for the equipment. The settlement is the largest civil fraud recovery ever by federal prosecutors in East Tennessee.

As part of the settlement, Hill-Rom will pay the federal treasury the penalty and abide by a five-year corporate integrity agreement with the Department of Health and Human Services. Nonetheless, the company said in a statement Tuesday that it “vigorously disagrees that there was any wrongdoing in this situation and this settlement does not represent any admission on our part.”

But Derrick Jackson, special agent in charge of the probe, said the settlement “puts companies on notice that, no matter their size, violating Medicare regulations will lead to investigation and prosecution.”

Two Hill-Rom nurses, Laurie Salmon and Lisa Brocco, brought the allegations against the company and helped the Justice Department pursue the Medicare fraud case. Under the federal whistleblower protection laws that reward those who find and help prosecute fraud, the two nurses will share more than $8 million from the proceeds of their settlement.

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