WASHINGTON, May 10, 2011 /PRNewswire/ -- In the wake of Sunday's California Watch report concerning state investigations
Prime, already under investigation by state and federal authorities for its uniquely high rate of septicemia, was identified by California Watch to have alarming rates of malnutrition, including hundreds of cases of Kwashiorkor, an extreme form of malnutrition typically found in famine-stricken populations. In its letters to the Medical Properties Trust board, CtW warned that if these incidences were proven to stem from systemic up-coding, Prime's potential liabilities could easily outstrip the operator's net income, posing considerable reimbursement risk to Medical Properties' shareholders.
"With the Federal government stepping up fraud prevention efforts […], we believe it is vital that Healthcare REITs, as part of their efforts to manage reimbursement risk, actively monitor the billing practices of key tenants and possible incidences of upcoding," wrote Mr. Patterson, noting that Medical Properties had failed to proactively respond to previous demands for a review. In addition to reviewing the situation at Prime, Mr. Patterson asked the board to clarify the status of federal and state investigations into Prime over possible Medicare fraud and to evaluate options for better monitoring of potentially fraudulent billing activities within the portfolio facilities.
Prime is a privately-held operator of acute hospitals in California. Medical Properties is a healthcare REIT focused on acute care facilities and headquartered in Birmingham, Alabama.
For further information please contact Michael Pryce-Jones at (202) 262-7437. Copies of CtW's correspondence with Medical Properties Trust can be accessed at www.ctwinvestmentgroup.com.
** NOTE: Please contact Michael Pryce-Jones at [email protected] or visit www.ctwinvestmentgroup.com. **
SOURCE CtW Investment Group
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