CHS to Pay $98 Million in False Claims Case

Local Hospital Owner Denies Wrong Doing

FRANKLIN — Community Health Systems Inc., owner of the Lock Haven Hospital, this week agreed to pay $98 million to settle U.S. Justice Department allegations it knowingly billed government health care programs “for inpatient services that should have been billed as outpatient…services.”

A Justice Department release said the U.S. alleged that CHS engaged in a “deliberate corporate-driven scheme to increase inpatient admissions” of Medicare, Medicaid and a Department of Defense program for beneficiaries over the age of 65 at 119 CHS hospitals.

The release did not identify all the hospitals covered in the allegations and a call to Lock Haven Hospital was not returned as of press time.

CHS released a statement from its corporate headquarters in Tennessee in which the company denied any wrong doing.

The for-profit company said the settlement agreement “reflects the company’s desire to end the investigation…and to avoid the significant expense and distraction of litigation.” Under terms of the agreement, CHS said, there is no finding of improper conduct by Community Health Systems.

The release quoted company CEO Wayne T. Smith who said, “Shifting and often ambiguous standards make it extremely difficult for physicians and hospitals to consistently comply with regulations.”

The settlement ends a three year federal investigation.

CHS has 206 affiliated hospitals in 29 states, including more than 20 in Pennsylvania.