ATLANTA (Legal Newsline) - Georgia Attorney General Thurbert Baker announced on Monday that he has reached a $2,738,000 settlement with a health systems company that allegedly filed false reimbursements in its Medicaid billing.

WellStar Health Systems allegedly made the improper Medicaid billing for inpatient and outpatient services provided at five WellStar hospitals -- Cobb, WellStar Kennestone, WellStar Windy Hill, Douglas and Paulding.

The case concerned "cross-over" claims, which are made for patients who have coverage by both Medicare and Medicaid. In this situation, Medicare becomes the primary coverage option with Medicaid operating in the secondary position.

The Georgia Medicaid Fraud Control Unit and the Department of Community Health, with assistance from an outside auditing firm, alleged that WellStar's billing for these cross-over claims did not reflect the full amount of Medicare prior payments, allowing the company to receive reimbursements from Medicaid that were excessive.

"Georgia's Medicaid Fraud Control Unit will continue to vigorously investigate all instances of overbilling as well as fraudulent billing in the Medicaid system," Baker said.

"Active enforcement and oversight are the keys to ensuring that Georgia taxpayers are not overpaying for Medicaid services, which is critical at all times but especially when demand for Medicaid services is so high and public monies to pay for Medicaid are scarcer than ever."

Under terms of the settlement, WellStar will pay the Georgia Department of Community Health a lump sum of $2,728,318 for all possible claims that come from their billing errors. The company will also pay the State $10,000 for costs associated with the litigation.

WellStar and its hospitals denied any wrongdoing and cooperated fully in this matter. Additionally, the company has put in place corrective actions to make sure that future billing errors do not occur.