Hospital Staffing Firm Agrees to Settle Qui Tam Suit for $14.5 Million

Sound Inpatient Physicians, Inc. (“Sound Inpatient”), based in Tacoma, Washington, has agreed to pay the federal government $14.5 million to settle allegations that it knowingly overbilled a number of federal health care programs.

Sound Inpatient is a staffing company that provides hospitalists and other post-acute physicians to hospitals and other medical facilities. Hospitalists are physicians that exclusively provide inpatient treatment at medical facilities – they do not provide outpatient services or have any outside medical practice. Sound Inpatient employs more than 700 hospitalists and post-acute physicians who work at approximately 70 medical facilities in 22 states.

A qui tam lawsuit filed in 2009 by whistleblower Craig Thomas, a former Sound Inpatient employee, alleged that Sound Inpatient submitted false claims to government health care programs such as Medicare and TRICARE. The federal government later intervened in the matter and alleged that between 2004 and 2012, Sound Inpatient submitted inflated claims on behalf of its hospitalists for more expensive levels of service than were actually documented in patient medical records.

Sound Inpatient will pay $14.5 million to settle the False Claims Act allegations. The whistleblower will receive approximately $2.7 million of the settlement proceeds as his reward under the qui tam provisions of the False Claims Act.