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Universal Health Services Settles Whistleblower Allegations for $117M

medicare fraud

July 14, 2020 – Los Angeles, California – – Universal Health Services (UHS) will pay $117 million dollars to resolve several whistleblower lawsuits alleging the Pennsylvania-based company billed government healthcare agencies for medically unnecessary inpatient behavioral health services and failed to provide appropriate care at dozens of its psychiatric facilities.

King of Prussia-based UHS owns and manages nearly 200 acute care inpatient psychiatric hospitals and residential psychiatric and behavioral treatment clinics throughout the country. The Universal Health Services whistleblower settlement resolves allegations initially raised by whistleblowers in 19 different lawsuits. As part of the resolution, the whistleblowers will receive rewards for bringing the allegations to the government’s attention.

The False Claims Act allows for private citizens with knowledge of fraud to file suit on the government’s behalf to recover funds that were obtained via false claims. The government may choose to intervene in the lawsuit and prosecute the action based on the allegations, as it did in this case. If a successful enforcement action is reached and money is recovered, the whistleblower (or whistleblowers) may be eligible to share in the recovery.

Whistleblower attorneys from the law firm of Baum Hedlund Aristei & Goldman represented one of the principal whistleblowers in this case.

“The significant recovery on behalf of government healthcare agencies in this case would not have been possible without our client and the other brave men and women who came forward to right a wrong and expose more than a decade of egregious false claims,” says Baum Hedlund Aristei & Goldman whistleblower attorney Mark Schlein. “We are proud of the relators for stepping forward and protecting taxpayer funds from waste and abuse. We owe them all a tremendous debt of gratitude for protecting the patients and the integrity of our healthcare system.”

“Patients in psychiatric facilities are vulnerable and deserve the highest level of care. "Health care service providers that put profit ahead of the needs of their patients have no place in our healthcare system.”

Allegations in $117 Million Universal Health Services Whistleblower Settlement

According to the U.S. Justice Department, between 2006 and 2018, Universal Health Services facilities admitted federal healthcare beneficiaries as patients who were ineligible for inpatient or residential treatment because their conditions did not require that level of care. According to the complaints, UHS also failed to properly discharge beneficiaries who were appropriately admitted for treatment after they no longer required inpatient care.

In addition to these charges, the whistleblowers alleged that UHS:

  • Billed for services not rendered;
  • Billed for improper and excessive lengths of patient stays at facilities;
  • Failed to provide adequate training, staffing, and/or supervision of staff;
  • Improperly used physical and chemical restraints and seclusion;
  • Failed to develop and/or update patient assessments and treatment plans;
  • Failed to provide adequate discharge planning;
  • Failed to provide required individual and group therapy services as required by federal and state laws.

So egregious were the allegations that in 2015, UHS announced in a filing with the U.S. Securities and Exchange Commission (SEC) that the company was under criminal investigation at a corporate level. The criminal probe was dropped a year ago after the company announced a civil settlement in principle with the Justice Department and several state attorneys general offices.

Universal Health Services will pay $117 million to resolve the whistleblower allegations. Of that total, $88.12 million will go to the federal government and $28.88 million will go to individual states, which jointly fund state Medicaid programs. The settlement resolves cases pending in the Eastern District of Pennsylvania, the Western District of Michigan, and the Eastern District of MichiganAs part of the resolution, the Universal Health Services whistleblowers will receive a percentage of the federal share of the settlement.

In addition to the $117 million payment, UHS agreed to enter into a Corporate Integrity Agreement with the U.S. Department of Health and Human Services (HHS), Office of Inspector General (OIG). The agreement will remain in effect for a period of five years. During this time, OIG will select an independent monitor to assess the company’s patient care protections and report to the OIG. Additionally, an independent review organization will perform annual reviews of UHS inpatient behavioral health claims to federal health care programs.

Baum Hedlund Aristei & Goldman | Whistleblower Attorneys

The whistleblower lawyers from the national law firm of Baum Hedlund Aristei & Goldman have decades of experience litigating qui tam cases against health care providersaerospace companiesdefense contractorspharmaceutical companies, and medical device manufacturers. Across all areas of practice, the firm has earned more than $4 billion in verdicts and settlements on behalf of clients.


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