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BayCare agrees to $20 million settlement in Medicaid payment case

Exterior of a hospital
BayCare Health System
St. Anthony's Hospital in St. Petersburg was one of four hospitals named in the Department of Justice's case.

The Department of Justice accused BayCare of making donations to a Pinellas County organization in order to increase its share of federal Medicaid funds.

BayCare Health System has agreed to pay $20 million to settle a federal case in which it was accused of filing false claims for Medicaid funds, according to a release from the Department of Justice.

The case involves donations that BayCare made to the Juvenile Welfare Board of Pinellas County between October 2013 and September 2015.

The Juvenile Welfare Board transferred a portion of the donations to the state’s Agency for Health Care Administration for Florida’s Medicaid program.

Those funds were then matched by federal Medicaid funds and returned to five BayCare hospitals in Pinellas County in the form of Medicaid payments, the Department of Justice said.

By making the donations, BayCare was able to increase its share of federal Medicaid funds without any state or local funds being spent, the complaint said.

“Medicaid is a partnership between the federal government and state governments,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division.

“When the federal government provides Medicaid matching funds, there must be a corresponding expenditure by the state, or a local unit of government. When private parties make unlawful, non-bona fide donations to state or local governments, they undermine a key safeguard for ensuring the integrity of the Medicaid program.”

A whistleblower who served as a former hospital reimbursement manager in Florida brought the claims forward and will receive $5 million as his share of the settlement.

“Millions of Floridians depend on the Medicaid Program for medical care and related services,” said U.S. Attorney Roger B. Handberg for the Middle District of Florida.

“Our office is committed to protecting the integrity of the Medicaid Program, and we will use all available civil remedies to recover the ill-gotten gains obtained by those who defraud it and other government health care programs.”

In an email to WUSF, a representative from BayCare said the allegations amounted to a disagreement with the federal government over a complex regulatory question.

“BayCare has admitted no wrongdoing and expressly denies the allegations against it, but we have settled to avoid the delay, uncertainty, and expense of litigation,” the email said. “At all times, BayCare fully cooperated with the government with respect to this matter.”

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