September 20, 2010; Source: Sign On San Diego | The U.S. Justice Department dropped a lawsuit on Monday after a nonprofit hospital owned by the city of El Centro, Calif., agreed to pay $2.2 million plus interest to settle allegations of Medicare fraud. El Centro Medical Center had been charged with submitting inflated bills for Medicare patients in the hospital for one day or less.

The government said the hospital should have sought reimbursements based on lower rates for outpatient care or emergency room visits. The hospital claimed the overcharging wasn’t intentional. Instead, David R. Green, El Centro chief executive, said it was due to misunderstandings over reimbursement rules. “This wasn’t done with any intent of fraud,” Green said. “We’re a public entity just trying to provide a public service.”

Allegations of fraud resulted from a lawsuit that a former medical center employee filed under the federal False Claims Act. According to Sign On San Diego, the whistleblower statute allows private citizens who suspect fraud to sue on behalf of the government. If the claim is successful, those blowing the whistle can share in any money recovered. For his efforts, Pietro Ingrande will receive $375,000.—Bruce Trachtenberg