LOUISVILLE, Ky. – An area hospital has agreed to pay almost one million dollars to settle allegations that it submitted false Medicare claims.

Jackson Purchase Medical Center of Mayfield, Kentucky has voluntarily entered into a settlement with the United States of America to pay $998,770.74 to settle allegations that it submitted false claims in violation of the Federal False Claims Act.

According to the settlement agreement, the United States contends that Pinelake Regional Hospital, LLC d/b/a Jackson Purchase Medical Center, inappropriately submitted additional charges to Medicare for certain gallbladder and biliary tract procedures including Endoscopic Retrograde Cholangiopancreatography (“ERCP”) and Laparoscopic Cholecystectomy (“Lap Chole”) procedures. Specifically, the United States alleged that Jackson Purchase Medical Center submitted additional charges for these procedures as inpatient admissions when, in fact, they should have been billed as outpatient admissions.  The over-billing covered a period between January 1, 2004 through December 31, 2010.

The settlement agreement shall be paid by electronic funds transfer no later than July 7, 2011.

This matter came to the attention of law enforcement after a beneficiary reported to Medicare that, upon reviewing her explanation of benefits, Jackson Purchase had incorrectly billed her hospitalization as an inpatient admission instead of an outpatient admission.

Jackson Purchase Medical Center has also agreed to enter into a five-year Corporate Integrity Agreement with the Office of Counsel to the Inspector General, United States Department of Health and Human Services.

This settlement agreement is neither an admission of liability by Jackson Purchase Medical Center nor a concession by the United States that its claims are not well founded.

For Jackson Purchase Medical Center's response to the settlement, click here.