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Manhattan US Attorney Announces $6.6 Million Settlement Against CityMD for False Medicare Claims

CityMD Admits that it Billed Medicare for More Expensive and Complex Services Than it Performed, and Billed Medicare Under the Names of Doctors Who Did Not Actually Render the Services

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced today a settlement of a civil fraud lawsuit against CityMD. This settlement resolves federal claims under the False Claims Act, 31 U.S.C. § 3729 et seq., alleging that CityMD billed Medicare for services rendered by physicians who did not actually perform those services, and billed Medicare for more expensive and complex services than were actually provided to patients. Under the terms of the settlement approved yesterday by U.S. District Judge Katherine Polk Failla, CityMD admitted and accepted responsibility for its conduct and agreed to pay $6,606,251.40 in damages to the United States.

Manhattan U.S. Attorney Geoffrey S. Berman said: “CityMD improperly billed Medicare at significant cost to taxpayers. This settlement holds CityMD accountable both through the significant monetary payment and the detailed admissions made by CityMD.”

CityMD manages and operates approximately 88 Urgent Care centers, located primarily in the New York City metropolitan area. As part of the settlement, CityMD admits, acknowledges, and accepts responsibility for the following conduct:

§ CityMD billed Medicare for lengthier and/or more complex services or procedures than the services or procedures it actually provided to patients or that were supported with documentation in the medical records. Had CityMD billed Medicare for the services actually rendered or supported by the documents in the medical records, it would have received a lower rate of reimbursement from the Medicare program.

§ Medicare rules generally prohibit medical providers, such as CityMD, from seeking reimbursement from the Medicare program for services rendered by a physician unless that physician is both enrolled with the Medicare program when the services are rendered and has reassigned his or her Medicare benefits to the billing provider (collectively known as being “credentialed” with the Medicare program).

§ CityMD is generally prohibited from billing Medicare for services rendered by an uncredentialed physician unless and until he or she is credentialed with the Medicare program.

§ CityMD employed a number of physicians who were not credentialed with the Medicare program at the time CityMD billed Medicare for their services.

§ CityMD falsely billed Medicare for services rendered by these uncredentialed physicians using the National Provider Identification numbers of other credentialed physicians who did not actually render the services in question.

In connection with the filing of the lawsuit and settlement, the Government joined a private whistleblower lawsuit that had been filed under seal pursuant to the False Claims Act.

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Mr. Berman noted that CityMD cooperated fully with this investigation.

The case is being handled by the Office’s Civil Division. Assistant U.S. Attorneys Mónica P. Folch and Jacob M. Bergman are in charge of the case.
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