Officials for Tenet Healthcare on Tuesday announced a $7 million settlement of a lawsuit filed by the state of Florida over allegations that the company received improper Medicare reimbursements, the Philadelphia Inquirer reports (Loyd, Philadelphia Inquirer, 2/22). In March 2005, Florida Attorney General Charlie Crist (R) filed a civil racketeering lawsuit on behalf of hospitals in the state over allegations of about $1 billion in improper Medicare reimbursements. The lawsuit alleged that Tenet inflated prices at a number of hospitals between 2000 and 2003 to increase reimbursements from the Medicare Outlier Pool, which pays hospitals that provide seriously ill patients with high-cost services (Kaiser Daily Health Policy Report, 3/3/05). The lawsuit involved 13 county hospital districts and health care systems in Florida (Philadelphia Inquirer, 2/22). Tenet denied any wrongdoing in the settlement (Hanks, Miami Herald, 2/22). In addition to the lawsuit, the settlement ends two other investigations by the Florida Medicaid Fraud Control Unit, as well as an investigation of some Medicaid reimbursements for psychiatric services provided at a hospital in South Florida (Philadelphia Inquirer, 2/22). Florida will use $4 million of the settlement to reimburse public hospitals for services provided to low-income and uninsured patients. Florida also will award an additional $2 million to hospitals in the state and use $1 million to cover the legal costs of the three-year investigation into Tenet.

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Tenet spokesperson Steve Campanini said that the settlement "resolves all of our issues" in Florida and "gives us a fresh start with the Attorney General's Office." Crist spokesperson JoAnn Carrin said, "We felt like we got the full restitution for the hospitals. Why go through additional litigation. This is a fantastic recovery." Elizabeth Foley, a law professor at Florida International University, said the amount of the settlement appeared small based on the allegations in the lawsuit. She said, "Either they didn't have a lot of confidence in their case, so a $7 million settlement is better than nothing; or they wimped out. It's one or the other" (Miami Herald, 2/22). According to Reuters/Los Angeles Times, the settlement represents a "modest positive" for Tenet, which has faced a number of lawsuits and investigations in recent years, but "bigger legal challenges remain, most notably a continuing federal investigation into Medicare billing" (Reuters/Los Angeles Times, 2/22).

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