Raritan Bay Medical Center, headquartered in Perth Amboy, N.J., has agreed to pay the United States $7.5 million to settle allegations that it defrauded the federal Medicare program, the Justice Department announced. The government alleged that, between January 1998 and August 2003, Raritan Bay purposefully inflated charges for inpatient and outpatient care to make these cases appear more costly than they actually were, and thereby obtained outlier payments from Medicare that it was not entitled to receive.
The civil settlement agreement resolves allegations against Raritan Bay that were filed in three separate federal lawsuits brought by whistleblowers under the federal False Claims Act. As part of the settlement, the hospital entered into a corporate integrity agreement with the Department of Health and Human Services’ Office of Inspector General, which contains measures to ensure compliance with Medicare regulations and policies in the future. The New Jersey Star-Ledger published a statement from Raritan Bay officials that said “during the period in question,” the hospital “believed its billing practices in connection with the Medicare outlier payment system were in accordance with existing Medicare regulations.”
