Tarrant County’s John Peter Smith Hospital (JPS) has agreed to pay more than $3.3 million to settle allegations that it violated the False Claims Act by upcoding certain claims submitted to federal healthcare programs. The settlement resolves a whistleblower suit filed in 2018 by JPS’s former Director of Compliance Erma Lee, whose complaint asserted that the hospital improperly appended billing modifiers -25, -59, and -XU to hundreds of claims in order to obtain payments to which it was not entitled. Used properly, these billing modifiers indicate that a provider administered significant care on the same day as another medical procedure that was above and beyond the preoperative and postoperative care “bundled” into the main procedure code. In her amended complaint, filed in September 2020, Ms. Lee alleged that she alerted hospital leadership that JPS had been improperly adding these modifiers to claims between 70 and 95 percent of the time, in essence routinely double billing for certain aspects of patients’ care. Nevertheless, she claimed, JPS failed to reimburse payors for overpayment stemming from these improperly coded claims.
