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10 charged in hospital billing scheme uncovered in Missouri

Posted at 8:05 PM, Jun 30, 2020
and last updated 2020-06-30 21:05:33-04

KANSAS CITY, Mo. — Ten people have been charged in connection to “an elaborate pass-through billing scheme using rural hospitals in several states” to submit false claims for laboratory testing,” according to a news release from the Department of Justice.

The indictment alleges that from approximately November 2015 through February 2018, the conspirators billed private insurance companies approximately $1.4 billion for laboratory testing claims as part of this fraudulent scheme, and were paid approximately $400 million,” the release stated.

Missouri State Auditor Nicole Galloway uncovered the scheme as part of a 2017 audit of Putnam County Memorial Hospital.

“Auditor Galloway found $90 million in illegal billings were passed through the 15-bed hospital in northern Missouri,” according to a release from Galloway’s office. “It marked the largest fraud exposed in the history of the Missouri State Auditor's Office.”

Galloway said in the release that her office worked with federal authorities for three years, which helped uncover “similar schemes” at other rural hospitals.

“Health care fraud impacts the cost of health care for all of us and affects the viability of hospitals and other health care facilities across rural Missouri,” she said in the release. “Those responsible for fraud must be held accountable, and my office remains committed to working with federal law enforcement to seek justice in these cases."