LRMC pays DOJ $4 million for allegedly ineligible Medicaid donations

The Lakeland Regional Medical Center (LRMC) in Lakeland, Florida has agreed to pay the United States $4 million to clear allegations that it donated to a local government to improperly fund the state’s share of LRMC’s Medicaid payments.

The US government stated that between October 2014 and September 2015, LRMC made improper, dishonest donations to Polk County by incurring and paying some of the county’s financial obligations to other health care providers.

These donations, according to the Department of Justice, were intended to increase the Medicaid payments received by LRMC by freeing up county funds to make payments to the state as the state’s share of LRMC’s Medicaid payments.

This state share was “matched” by the federal government before being returned to LRMC as Medicaid payments, the Justice Department said. As such, Medicaid payments received by LRMC were funded by the federal government and LRMC’s own donations, in violation of the prohibition on unscrupulous donations.

WHAT INFLUENCES

The Florida Medicaid program provides medical care to low-income individuals and individuals with disabilities and is jointly funded by the federal and state governments. Under federal law, Florida’s share of Medicaid payments must be made up of state or local government funds and cannot come from “bad faith donations” from private health care providers such as hospitals.

A bad faith donation is a payment—in cash or in kind—from a private provider to a government agency that is then returned to the private provider through a Medicaid payment. Because Medicaid services are reimbursed jointly by the federal and state governments, a bad faith donation results in an increase in federal spending without a corresponding increase in state spending because the state’s share of the provider’s Medicaid payment comes from and is returned to the provider. provider, the Justice Department said.

The agency said banning the practice ensures that states actually pay a portion of Medicaid payments and thus have an incentive to limit Medicaid spending and prevent unnecessary services.

BIG TREND

The Department of Justice was actively investigating potential healthcare-related fraud. Last month alone, the agency indicted more than two dozen people for their alleged involvement in a wire fraud scheme that created illegal licensing and reduced employment opportunities for aspiring nurses.

According to three recently unsealed indictments returned by a South Florida federal grand jury and documents filed by federal prosecutors, the defendants were allegedly involved in a scheme to sell fake diplomas and medical credentials from accredited nursing schools in Florida to people seeking licenses and employment in registered nurses (RN) and licensed practical/professional nurses (LPN/VN).

The Justice Department said the fake diplomas and transcripts allowed buyers to take the National Council of Nursing exam and, upon passing it, earn licenses and jobs in various states as RNs and LPN/VNs.

The overall scheme involved distributing more than 7,600 fake nursing diplomas issued by three nursing schools in South Florida: Siena College in Broward County, Palm Beach School of Nursing in Palm Beach County, and Sacred Heart International Institute in Broward County. These schools are now closed.

According to the Ministry of Justice, each accused faces up to 20 years in prison.

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