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Tenet Healthcare settles Medicare fraud case for $900 million

[JURIST] Tenet Healthcare [corporate website] has agreed to pay $900 million [US DOJ press release] to resolve federal allegations of illegal Medicare billing practices. Tenet was charged [DOJ press release] in 2003 with violating the False Claims Act [text] by billing the government for services not provided to patients, billing it for "outlier" costs "substantially in excess" of the actual cost of care, and for paying kickbacks to doctors in exchange for Medicare referrals. Under the settlement agreement, Tenet is not required to admit guilt, though in a company statement [text] released Friday, Tenet admitted that billing "mistakes were made." Tenet will sell 12 hospitals to offset settlement costs, of which $470 million will be paid immediately, with the rest to be paid by 2010. AP has more.

In January, Tenet settled a class-action lawsuit for $215 million [JURIST report] brought by shareholders alleging breach of fiduciary duty, mismanagement and unjust enrichment in misleading investors about Medicare expenses. Seventy-three employees of a Tenet-owned hospital in Louisiana were subpoenaed last year as part of the ongoing investigation [JURIST reports] into deaths alleged at hospitals and nursing homes in the wake of Hurricane Katrina [JURIST news archive].

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