Allina paying $2.56 million to feds in settlement

The U.S. Department of Justice has reached settlements with 457 hospitals, including four in the Minneapolis-based Allina system, stemming from allegations that patients received certain heart devices in violation of Medicare coverage requirements.

Hospitals in 43 states have paid more than $250 million as part of the settlements, the Justice Department said Friday, including $2.56 million from Allina and four affiliated hospitals in Minnesota.

The government alleged that hospitals didn't follow rules for when patients could receive expensive heart devices called implantable cardiac defibrillators (ICDs).

The devices cost about $25,000 each, and the government says ICDs generally should not have been implanted in patients during specified waiting periods following heart attack, bypass surgery or angioplasty.

"The medical purpose of a waiting period … is to give the heart an opportunity to improve function on its own to the point that an ICD may not be necessary," the government said in a news release. "The Department of Justice alleged that from 2003 to 2010, each of the settling hospitals implanted ICDs during the periods prohibited."

In a statement, Allina said it continues to believe the procedures were medically necessary and performed "consistent with current standards of medical practice."

"We chose to settle this case to avoid the time and expense of protracted litigation," Allina said in the statement. "Providing the highest-quality, evidence-based, safe patient care is our top priority."

Most of the settling hospitals were named in a whistleblower lawsuit brought seven years ago under the False Claims Act, where private citizens bring lawsuits on behalf of the United States and can receive a portion of proceeds. The lawsuit was filed in Florida, and whistleblowers have received more than $38 million, the government said.

"While recognizing and respecting physician judgment, the department will hold accountable hospitals and health systems for procedures performed by physicians at their facilities that fail to comply with Medicare billing rules," said Benjamin Mizer, principal deputy assistant attorney general, in a statement. "We are confident that the settlements announced today will lead to increased compliance and result in significant savings to the Medicare program while protecting patient health."

Implantable cardiac defibrillators are a big business in the Twin Cities, with the country's three largest manufacturers of the devices — Boston Scientific, Medtronic and St. Jude Medical — having extensive operations in Minnesota. The devices detect and treat heart rhythm problems by shocking hearts to restore normal rhythms.

None of those companies was mentioned in the government's news release.

Christopher Snowbeck • 612-673-4744