QUORUM HEALTH GROUP SUCCESSOR COMPANY AND SUBSIDIARY
TO PAY OVER $400,000 FOR ALLEGEDLY DEFRAUDING MEDICARE

WASHINGTON, D.C. – Quorum Health Group successor company, Triad Hospitals of Dallas, and Quorum subsidiary, Gadsden, Alabama, Regional Medical Center, have agreed to pay the United States $428,343 to settle claims that they defrauded Medicare, the Justice Department announced today.

The civil settlement resolves allegations that Brentwood, Tennessee-based Quorum and Gadsden defrauded Medicare from 1993 to 1997 by improperly charging the federal health care program for the salaries of employees who performed no work for the company. It is further alleged that the two companies improperly charged Medicare for payments Quorum and Gadsden intended to make to a physician of the former hospital owner. Further, it is alleged that the companies improperly charged Medicare for payments made by Quorum and Gadsden to two individuals performing services for outside physicians.

The allegations arose from a lawsuit filed by three former employees of Gadsden - Jan Harper, manager of the business office; Martha Baker, manager of the data processing department; and Diane Brittan, executive secretary of Gadsden's chief executive officer. The suit was filed under the qui tam or whistleblower provisions of the False Claims Act, a federal law that allows private individuals to sue on behalf of the United States and share a percentage of the government's recovery.

The United States alleged that Quorum and Gadsden improperly charged hospital costs on Gadsden's Medicare cost reports. As a result, the two companies received more reimbursement from Medicare than they should have.

The civil investigation and settlement were jointly handled by the United States Attorney's Office in Birmingham, Alabama and the Justice Department's Civil Division with the assistance of the Department of Health and Human Services Office of Inspector General, including the Office of Counsel.

The case is entitled United States ex rel. Jan Harper, Martha Baker, and Diane Brittan v. Quorum Health Group d/b/a/ OHG, which owns and operates Gadsden Regional Medical Center, designated as a separate corporate entity, Civil Action No. CV-98-TMP-3218-M (N.D.-AL)

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