“Patients and taxpayers who fund health programs like Medicare deserve to know that doctors make decisions based solely on medical needs – not at the request of businesses to increase bills,” said U.S. Assistant Premier Justice Tracy Wilkison for the Central District of California. “The Department of Justice is committed to preserving the integrity of public health programs and preventing poor billing practices.” Prime Healthcare Services and the nonprofit Prime Healthcare Foundation, headquartered in Ontario, California, are one of the largest hospital systems in the country with 45 acute hospitals in 14 states. The following 10 people charged with hospitalization in possession of premium health services are parties to the settlement agreement: Alvarado Hospital Medical Center, Garden Grove Medical Center, Palma Intercommunity Hospital, Valley Valley Valley Hospital, Chino Valley Medical Center, Paradise Valley Hospital, San Dimas Community Hospital, Shasta Regional Medical Center West Anaheim Medical Center and Centinela Medical Center. The following four defendants, belonging to the Prime Healthcare Foundation, are also parties to the settlement agreement: Sherman Oaks Hospital, Montclair Hospital Medical Center, Huntington Beach Hospital and Encino Hospital Medical Center. Prime Healthcare Management, a subsidiary of Prime Healthcare Services, provides management, advisory and support services to Prime-owned hospitals managed by Prime. The comparison includes allegations that, from 2006 to 2013, Prime implemented a deliberately company-oriented system to increase hospitalization of Medicare receivers, initially submitted to emergency departments at 14 Prime hospitals in California. The government stated that hospitalization of these recipients was not medically necessary because their symptoms and treatment needs should have been managed in a less expensive outpatient or observational environment. Hospitals generally receive significantly higher payments from Medicare for hospitalizations than for outpatient care; As a result, receiving beneficiaries who do not require hospitalization can result, as is claimed here, in significant financial damage to the Medicare program. The comparison also clarifies allegations that Prime from 2006 to 2014 was implicated by falsification of information about patients` diagnoses, including complications and comorbidities, in order to increase Medicare reimbursement.

Prime must also comply with a five-year Corporate Integrity Agreement, which requires the company to hire independent consultants to verify its Medicare accounts, as the records show. Under the transaction agreement, Dr. Reddy will pay US$3.25 million $US and Prime $61.75 million. Ten people charged with hospitalization belonging to Prime Healthcare Services are parties to the settlement agreement: Alvarado Hospital Medical Center, Garden Grove Medical Center, Intercommunity De Palma Hospital, Valley Valley Hospital, Chino Valley Medical Center, Paradise Valley Hospital, San Dimas Community Hospital, Shasta Regional Medical Center, West Anaheim Medical Center and Centinela Hospital Medical Center.