Carolinas Healthcare to pay $6.5 million for deceptive billing practices

- Carolinas Healthcare System (CHS) has agreed to pay the government $6.5 million to resolve allegations that the company violated the False Claims Act by "up-coding" claims for urine drug tests in order to receive higher payment than allowed for test, officials say.

U.S. Attorney for the Western District of North Carolina, Jill Westmoreland Rose announced the settlement Friday.

According to court documents, from 2011 to 2015, CHS conducted urine tests, categorized as "moderate complexity" tests by the Food and Drug Administration (FDA), but submitted claims that indicated the company had conducted "high complexity" tests. 

The allegegations arose from a lawsuit filed by a whistleblower, Mark McGuire, a former laboratory director for CHS, under the qui tam provisions of the False Claims Act. Under the law, private citizens can bring suit on behalf og the government for false claims and share in any recovery. The act also allows the government to intervene and take over the action. 

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