Skyline Urology to Pay $1.85 Million to Settle False Claims Act Allegations of Medicare Overbilling

Skyline Urology has agreed to pay the United States $1.85 million to resolve allegations that it violated the False Claims Act by submitting improper claims to the Medicare program for evaluation and management services, the Department of Justice announced today.

“Physicians and practice groups are expected to bill Medicare properly for the services they provide,” said Assistant Attorney General Jody Hunt of the Department of Justice’s Civil Division.  “This settlement sends a clear message that the Department of Justice will hold healthcare providers accountable if they knowingly overbill federal healthcare programs.” 

Between Jan. 1, 2013, and Dec. 31, 2016, Skyline Urology allegedly submitted false claims to the Medicare program for evaluation and management (E&M) services that were not allowable under Medicare.  Medicare generally prohibits healthcare providers from separately billing for E&M services provided on the same day as another medical procedure, unless the E&M services are significant, separately identifiable, and above and beyond the usual preoperative and postoperative care associated with the medical procedure.  If an E&M service satisfies these criteria, the provider can use a billing code known as “Modifier 25” to bill for the significant and separately identifiable E&M services.  In this case, the government alleged that Skyline Urology used Modifier 25 to improperly unbundle routine E&M services that were not separately billable from other procedures performed on the same day, and, as a result, improperly claimed compensation from Medicare for certain urological services.

“The U.S. Attorney’s Office for the District of Maryland is committed to thoroughly investigating claims of fraud and holding health care providers accountable when they break the rules,” said U.S. Attorney Robert K. Hur.  “This settlement is an example of how whistleblowers and government can work together to recoup and deter overbilling practices.”

Skyline Urology has also entered into an Integrity Agreement with the U.S. Department of Health and Human Services, Office of Inspector General that will require regular monitoring of its billing practices for three years. 

“Providers are expected to closely follow Medicare rules and bill properly — nothing more, nothing less,” said Maureen R. Dixon, Special Agent in Charge of the Office of Inspector General of the U.S. Department of Health and Human Services.  “Taxpayer money wasted is money stolen from this vital federal health program.”

The settlement resolves allegations in a lawsuit filed in the District of Maryland by James M. Cesare, the founder of the consulting firm Bay Area Healthcare Advisors LLC.  The lawsuit was filed under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private individuals to sue on behalf of the government for false claims and to share in any recovery.  As part of the resolution, Mr. Cesare will receive approximately $323,750.

The settlement was the result of a coordinated effort by the Civil Division of the Department of Justice, the United States Attorney’s Office for the District of Maryland, and the Department of Health & Human Services, Office of Inspector General.     

The case is captioned United States ex rel. Cesare v. Skyline Urology, No. 1:16-cv-04059-JKB (D. Md.).  The claims resolved by the settlement are allegations only and there has been no determination of liability.