Health Management Associates Settles False Claims Act Lawsuits for $260 Million
Health Management Associates (HMA), a former hospital chain operating across the United States, agreed in September 2018 to pay $260 million to resolve multiple False Claims Act lawsuits filed by whistleblowers and to enter a criminal guilty plea in connection with fraudulent billing practices.
This landmark healthcare fraud settlement exposed a systemic scheme to increase inpatient hospital admissions, regardless of medical necessity, in violation of federal healthcare laws.
Whistleblowers Represented by Wilbanks & Gouinlock
Among the whistleblowers who played a pivotal role in uncovering the fraudulent practices at HMA were Ralph Williams and Dr. Craig Brummer, both represented by Wilbanks & Gouinlock (W&G).
Their independent complaints, later consolidated as part of the False Claims Act settlement, revealed widespread Medicare and Medicaid fraud within the HMA hospital system.
Click here to read the Wilbanks & Gouinlock press release on the HMA settlement.
Meet the Whistleblowers
- Ralph Williams – Former Chief Financial Officer (CFO) for two HMA-owned hospitals in Georgia.
- Dr. Craig Brummer – Emergency department physician and medical director at the same hospitals.
While their lawsuits were filed separately, both Williams and Brummer provided firsthand evidence of HMA’s fraudulent hospital admission practices.
Allegations of Unnecessary Hospital Admissions
Both whistleblowers exposed a corporate scheme that pressured physicians and hospital staff to prioritize financial gain over patient care. Their False Claims Act complaints revealed that:
Dr. Brummer attended daily meetings where emergency department physicians were pressured to increase inpatient admissions, regardless of medical necessity, to maximize Medicare and Medicaid reimbursements.
Ralph Williams observed HMA leadership setting aggressive system-wide goals for increased hospital admissions, even when patients could have been treated in outpatient settings.
These fraudulent practices violated federal healthcare regulations, including:
- The False Claims Act (FCA) – Prohibiting false or fraudulent claims submitted to government healthcare programs.
- The Anti-Kickback Statute – Preventing financial incentives that improperly influence medical decisions.
- Medicare and Medicaid Rules – Requiring hospital admissions to be based on medical necessity, not financial incentives.
$62.5 Million Recovery and Criminal Case Impact
HMA’s $260 million settlement resolved a wide range of fraud allegations, but the claims filed by Dr. Brummer and Mr. Williams directly led to a $62.5 million recovery.
Their whistleblower complaints also contributed significantly to the criminal case against HMA, resulting in:
- Criminal penalties imposed on the company.
- A guilty plea by HMA for engaging in fraudulent billing practices.
- Increased government scrutiny of hospital admission practices nationwide.
As a result of these whistleblower disclosures, HMA and its leadership faced accountability, marking one of the largest False Claims Act settlements in the hospital industry.
The Role of Whistleblowers in Exposing Healthcare Fraud
The HMA False Claims Act settlement highlights the critical role whistleblowers play in exposing fraudulent healthcare practices. Without the courage of employees like Williams and Brummer, the systemic abuse of government healthcare programs might have continued unchecked.
The False Claims Act (FCA) empowers private individuals—known as qui tam relators—to file lawsuits on behalf of the government when they have evidence of fraud. In return, successful whistleblowers may receive a percentage of the recovered funds as a reward.
Why Whistleblowers Matter in Healthcare Fraud Cases
- Protecting taxpayer dollars – Preventing fraudulent overbilling from draining Medicare and Medicaid funds.
- Ensuring patient care is prioritized – Stopping hospitals from financially incentivizing unnecessary admissions.
- Holding corporations accountable – Preventing profit-driven healthcare decisions that violate federal laws.
In this case, Williams and Brummer’s decision to come forward not only led to millions in recoveries but also set a precedent for holding hospital systems accountable for fraudulent admission schemes.
How to Report False Claims Act Violations
If you have evidence of fraud in healthcare, government contracts, or other federal programs, you may be eligible to file a False Claims Act lawsuit. Contact our office for a free consultation:
This article is for informational purposes only and should not be considered legal advice.
