News: CDI specialist blows the whistle, costs health system $18.3 million

Phoenix-based nonprofit Banner Health hired Cecilia Guardiola, RN, as corporate director of CDI in fall 2012, HealthLeaders Media reported. Within three months, however, Guardiola resigned over concerns that Banner seemed to be billing Medicare improperly. When she told administrators that she found inflated numbers and falsified documents, her bosses were allegedly unwilling to change, according to Healthleaders Media.

“It became clear to her very quickly that the interest was on enhancing revenue and not on guaranteeing compliance or integrity,” Guardiola's attorney Mitch Kreindler told HealthLeaders Media.

Guardiola filed a federal whistleblower lawsuit under the False Claims Act in 2013, detailing her allegations. That lawsuit was settled this week, with Banner agreeing to pay more than $18 million, the Department of Justice (DOJ) announced.

Twelve of Banner's hospitals in Arizona and Colorado had been accused of taking patients who could have been treated in an outpatient setting and admitting them instead for costlier inpatient care, then submitting false claims to Medicare, HealthLeaders Media reported.

“Hospitals that bill Medicare for more expensive services than are necessary will be held accountable,” said Christian J. Schrank, special agent in charge for the Department of Health and Human Services (HHS) Office of Inspector General (OIG), in the DOJ's written announcement. “Medical decisions should be made based on patients’ conditions and needs, not on providers’ profits.”

The organization has until April 20 to pay the federal government $18.3 million, plus 2.25% interest calculated from last May, according to the settlement agreement, which was filed in federal court last week. The government will then pay Guardiola 18% of that amount, about $3.3 million.

The health system must also pay more than $144,000 in Guardiola's legal fees.

Banner spokesperson Becky Armendariz released a statement saying the organization is “fully committed” to complying with regulations and the law while providing high-quality patient care, HealthLeaders Media reported.

“Although the rules that dictate when a hospital can accommodate a physician's request to admit a Medicare patient are complex and evolving, our policy has always been to make those decisions in accordance with government guidelines,” Armendariz said in an email.

“The settlement does not involve any finding of wrongdoing on Banner's part, and we are pleased to resolve this matter to avoid the disruption and expense of ongoing litigation,” Armendariz added.

Guardiola’s complaint had accused Banner of knowingly defrauding the government by:

• Falsifying Medicare bills to avoid denials
• Billing short-term outpatient services as though they were inpatient services
• Inflating the number of hours spent observing patients

The complaint lists hundreds of specific transactions that Guardiola alleged were billed inappropriately, HealthLeaders Media reported. Banner’s spokesperson declined to comment on the specific allegations Guardiola and her attorneys raised.

Editor’s note: This article originally appeared in HealthLeaders Media. To read the news release from the DOJ, click here. To read Guardiola’s complaint, click here. To read all about CDI’s role in denial prevention, read the September/October 2017 edition of the CDI Journal.