It was announced on Tuesday that the Huron Consulting Group Inc won a dismissal of a whistleblower lawsuit that accused it of causing a hospital in New York to receive over $30 million in inflated payments under Medicaid and Medicare programs, according to Reuters.
The ruling was issued by U.S. District Judge Jed Rakoff in Manhattan and it was made against Associates Outlier Fraud, which filed the lawsuit under the federal False Claims Act and a New York state law.
Empire HealthChoice Assurance Inc. was also named as a defendant in the lawsuit. The company was the fiscal intermediary that served the hospital, St. Vincent Catholic Medical Center.
“We believed from the beginning of the case that the allegations were without merit and are gratified to have the case dismissed with prejudice,” said Jennifer Frost Hennagir, a spokeswoman for Huron.
The lawyer for the whistleblower in the case, Philip Michael, said, “We’re examining it to determine what our next step would be.”
Huron noted in its annual report that it had preliminary settlement talks with Associates Against Outlier Fraud, and as a result, it recorded a $1.2 million charge in the second quarter of 2012. Hennagir noted that there is no settlement offer still on the table.
The lawsuit was filed in 2009 and it centered around events that led to the restructuring of St. Vincent Catholic Medical Center and its filing for bankruptcy in 2005. Associates Against Outlier Fraud is owned by Steven Landgraber, who previously worked as an accountant consultant at St. Vincent’s from 2005 to 2006.
In the lawsuit, it is noted that Speltz & Weis was hired in 2003 by St. Vincent’s to help improve its business. Speltz & Weis was then acquired by Huron in 2005.
“There is, in sum, no law, rule, regulation or fact rendering Huron’s submission of outlier-producing bills under these circumstances false or fraudulent,” Rakoff said.