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The medical center was accused of improper conduct between 1997 and 2007, including falsely inflating its bed count to Medicare to receive higher payments under the federal program's Disproportionate Share Hospital adjustment, according to the U.S. Department of Justice.
The DSH adjustment is an extra Medicare payment available to hospitals that meet certain requirements, including having 100 or more acute care beds.
The medical center was also accused of improperly obtaining payments under the Medicaid program for services provided to patients at the center's Institutes for Mental Disease who were between 22 and 64 years old.
Those services are ineligible for federal funding, and the county was required to report them separately to the California Department of Mental Health to ensure that no federal funds were used to pay for them, according to the U.S. Attorney's office.
The settlement resolves allegations that were filed in San Francisco by Ronald Davis, a former county employee who filed the lawsuit under the whistleblower provisions of the False Claims Act. The act permits whistleblowers to bring lawsuits on behalf of the U.S. and receive a portion of the proceeds of a settlement. Davis will receive $1.02 million of the proceeds of the settlement, according to the U.S. Attorney's office.
"Today's settlement demonstrates the government's ongoing commitment to protect the integrity of federal health care programs," Assistant Attorney General Michael F. Hertz said in a statement.
Beverly Thames, public information officer for the San Mateo County Health Department, released a statement on behalf of the county, which denied intentional wrongdoing in the matter.
"At the time the alleged overpayments occurred, the regulations were in flux and open to interpretation...Due to the complexity of the rules, some beds that we thought qualified under the reimbursement program, in retrospect, may not have qualified," Thames said in the statement.
"We are pleased to settle this matter now. The San Mateo County Board of Supervisors authorized County Council to settle out of court, rather than risk triple fines. In addition, the county will enhance training, auditing and reporting in its compliance program at San Mateo Medical Center," Thames added.
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