Karin Berntsen is a registered nurse whose whistleblower lawsuit accused her new employer of massive healthcare fraud against the government. Though 7 years passed between the time she came forward to report Prime Healthcare’s wrongdoing and the resolution of the case, the reward was enormous: the company agreed to a $65 million settlement, and Berntsen’s reward was the maximum amount allowed for “relators”, a significant $17,255,000.
The whistleblower healthcare fraud case began when Berntsen’s employer, Alvarado Hospital in San Diego, was purchased by Prime in 2010. Berntsen had been Alvarado’s Director of Performance Improvement. One month after the acquisition she began to notice that some changes being implemented by Prime to increase Alvarado’s profitability were questionable: she spoke to her supervisors about her concerns but felt that further complaints would lead to her losing her job. That was when she filed a whistleblower complaint citing changed billing practices and tactics that led to unnecessary overnight admissions that allowed the hospital to bill Medicare more than was medically necessary.
Whistleblower Lawsuit Names 5th Largest For-Profit Hospital and Its CEO
As a result of the successful whistleblower lawsuit, the company and its CEO, Dr. Prem Reddy are splitting the $65 million settlement for having fraudulently billed Medicare, with the CEO paying $3.25 million. By unnecessarily admitting patients to the hospital overnight instead of treating them as outpatients, they were able to bill the agency three to four times the amount that was appropriate. The company was also accused of having used inappropriate billing codes that made patient conditions seem more dire, which also increased billing. To support her whistleblower accusation, Ms. Berntsen reportedly provided the government with documents and recording of Dr. Reddy discussing the Medicare fraud.
The hospital will also be required to undergo an independent review of their Medicare claims, at their own cost, and will enter a Corporate Integrity Agreement with the Department of Health and Human Services.