SYRACUSE — Federal and state authorities ordered St. Joseph’s Hospital Health Center to pay $3.2 million after its comprehensive psychiatric emergency program (CPEP) sought Medicaid payments for mental-health services that were “rendered by unqualified staff.”

The Syracuse hospital violated the federal and New York False Claims Act in making the false claims for payment to New York’s Medicaid program, New York Attorney General Eric Schneiderman said in a news release issued Aug. 1. He made the announcement with U.S. Attorney Richard Hartunian.

Medicaid is a jointly funded federal-state program that provides health care to needy individuals.

The $3.2 million payment settles a whistleblower lawsuit, according to a news release from the Rochester law firm of Thomas & Solomon LLP. Attorneys Nelson Thomas, Michael Lingle, and Jonathan Ferris represented the whistleblower in the case, the firm said.

The release didn’t name the individual described as the “whistleblower.” That person will receive $560,000 of the settlement proceeds after St. Joseph’s makes “full payment,” Schneiderman’s office said.

Thomas & Solomon is “very happy with the settlement,” Thomas said in the firm’s news release.

“Our client saw that St. Joseph’s was exposing an extremely vulnerable patient population to great risk, many of whom were suffering from life threatening mental health conditions. Instead of sitting back and allowing this conduct to continue, our client took the brave step of contacting us and blowing the whistle,” said Thomas.

The lawsuit, which was originally filed under seal in July 2014, led to the investigation by the U.S. Attorney’s Office for the Northern District of New York and the New York State Attorney General’s Office.

“Mental-health staffing requirements are intended to protect the public and avoid the waste of public funds by ensuring that services are delivered by qualified personnel in a meaningful way,” Schneiderman said in his release.

St. Joseph’s is “pleased” to bring the matter to a resolution, Kathryn Ruscitto, president and CEO of St. Joseph’s Health, said in a statement the organization released Aug. 1.

“We fully cooperated with the U.S. Attorney’s Office / Northern New York District and the New York Attorney General’s Office throughout the course of their inquiries. We remain confident that St. Joseph’s personnel, working in our state-certified mobile crisis outreach program, acted appropriately and in the best interests of our patients. We settled this matter to avoid the delay, uncertainty and the high expense of bringing this case to trial as well as the potential disruption to our mission of caring for our patients and communities,” said Ruscitto.

Case background
St. Joseph’s CPEP provides evaluation and treatment for individuals suffering from an acute mental-health crisis.

The CPEP’s mobile crisis-outreach unit provides initial evaluation and assessment and crisis-intervention services to individuals in Onondaga and Madison counties who are unable or unwilling to use hospital-based crisis-intervention services in the emergency room.

The mobile-crisis unit also provides interim crisis services for patients discharged from the emergency room who require follow up care from a mental-health professional.

New York has issued regulations governing the staffing of CPEPs, Schneiderman’s office said.

The regulations say that at least two CPEP staff members shall be present whenever crisis-intervention services are rendered outside of an emergency room.

One of the CPEP staff members “must” be a member of the professional staff, according to Schneiderman’s office.

Professional staff includes credentialed alcohol counselors, physicians, psychiatrists, psychologists, registered professional nurses, rehabilitation counselors, and social workers.

The regulations stipulate compliance with these staffing requirements as a condition for payment of claims for CPEP services, “making clear” that use of qualified staff is a prerequisite for government payment of Medicaid claims for these services.

The settlements resolve allegations that St. Joseph’s knowingly presented false claims for payment to Medicaid for mobile-crisis outreach services rendered from Jan. 1, 2007, through Feb. 29, 2016, by personnel who “failed to satisfy” the basic CPEP staffing requirements.

“By submitting claims for payment to Medicaid without disclosing that its CPEP staff failed to meet the regulatory staffing requirements, and by accepting payment for these claims, the governments allege that St. Joseph’s misrepresented its compliance with mental health staffing requirements that are central to the provision of counseling services and, by doing so, violated the False Claims Act,” Schneiderman’s office said.

As part of the settlements, St. Joseph’s admits that it was “improper” to have conducted mobile crisis-outreach visits without a member of its CPEP professional staff present and then bill Medicaid for such services.        

Contact Reinhardt at ereinhardt@cnybj.com