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Tennessee-based HCA Healthcare owns and operates about 200 hospitals and healthcare facilities in the USA, the UK (where they own six private hospitals) and Switzerland. It is the largest for-profit hospital chain in the USA.

It has expressed interest in becoming involved in the British government's attempt to expand private sector provision of NHS services. It was one of the unsuccessful bidders for the government's DTC projects.

In December 2000 Columbia/HCA pleaded guilty to criminal conduct and paid out $840m in criminal fines, civil penalties and damages for alleged unlawful billing practices in what the US government described as 'the largest government fraud settlement ever reached by the Justice Department'.

Under the agreement, HCA agreed to pay $745 million to resolve five allegations regarding the billing of the U.S. government and the states for health care costs. The agreement did not resolve allegations that HCA unlawfully charged for the costs of running its hospitals on cost reports submitted to the government, and that it paid kickbacks to physicians to get Medicare and Medicaid patients referred to its facilities.

The settlement requires HCA to pay:

* more than $95 million to resolve civil claims arising from the company's outpatient laboratory billing practices, which included billing to Medicare, Medicaid, the Defence Department's TRICARE health care program, and the Federal Employees' Health Benefits Program, for lab tests that were not medically necessary, not ordered by physicians, as well as other billing violations;

* more than $403 million to resolve civil claims arising from "upcoding," where false diagnosis codes were assigned to patient records in order to increase reimbursement to the hospitals by Medicare, Medicaid, TRICARE and the Federal Employees' Health Benefits Program. The guilty plea includes one count relating to this upcoding practice;

* $50 million to resolve civil claims that the company illegally claimed non-reimbursable marketing and advertising costs it disguised as community education. Medicare reimburses providers for "community education" - costs to educate the community at large about public health issues - but not for advertising and marketing a hospital's services;

* $90 million to resolve civil claims that HCA illegally charged Medicare for non-reimbursable costs incurred in the purchase of home health agencies owned by the Olsten Corporation, as well as other agencies in Florida, Georgia and Alabama. According to the government, HCA devised an elaborate scheme to hide these costs in reimbursable "management fees" paid to third parties. In 1999, a subsidiary of Olsten Corporation, Kimberly Quality Care, entered into criminal plea agreements in three districts and paid more than $10 million in criminal fines. Olsten paid nearly $41 million as part of a civil settlement arising from its collusion with HCA for that conduct. HCA has now agreed to pay $90 million to settle this issue, and;

* $106 million to resolve civil claims for billing Medicare, Medicaid and TRICARE for home health visits for patients who did not qualify to receive them or were not performed and for committing other billing violations.

In addition to the civil settlement, two HCA subsidiaries HCA, Columbia Homecare Group Inc. and Columbia Management Companies Inc. entered into a criminal plea agreement in which they agreed to pay $95,336,432 in criminal fines and plead guilty to several charges involving a wide range of criminal conduct which occurred at HCA's hospitals nationwide.

Under the agreement the companies pleased guilty to charges involving:

* cost report fraud,
* fraudulent billing of Medicare for personnel who worked at home health agencies and at wound care centres,
* fraudulent billing to Medicare for patients diagnosed with pneumonia,
* paying kickbacks and other remuneration to doctors to induce referrals,
* paying kickbacks in connection with the purchase and sale of home health agencies and
* fraudulent billing of Medicare for fees paid to manage those agencies.

The subsidiaries also pleaded guilty to the following criminal charges:

* Southern District of Florida (Miami) Columbia Homecare Group Inc., a subsidiary of Columbia: guilty to one count of conspiracy to defraud the U.S. and to violate the Medicare Anti-kickback Statute involving its fraudulent business in the purchase and operation of home health agencies and fraudulent billing of Medicare for management and personnel costs. The criminal fine is $3.36 million;

* Northern District of Georgia (Atlanta) Columbia Homecare Inc.: guilty to one count of violating the Medicare Anti-kickback Statute related to purchase of home health agencies. The criminal fine is $3.36 million;

* Columbia Management Companies Inc.: guilty to one count of conspiracy to defraud the U.S. and to make and use false writings and documents in connection with its fraudulent "upcoding" of bills to Medicare for patients diagnosed with certain types of pneumonia. The criminal fine is $27.5 million. This investigation was based in Nashville, Tennessee;

* Middle District of Florida (Tampa) Columbia Homecare Group: guilty to one count of conspiring to defraud the U.S. and one count of conspiracy to violate the Medicare Anti-kickback Statute in connection with the purchase and operation of home health agencies. The criminal fine is $8.4 million.

* Columbia Management Companies: guilty to eight counts of making false statements to the U.S. in connection with the submission of false cost reports to Medicare. The fine amount is $22.6 million; and,

* Western District of Texas (El Paso). Columbia Homecare Group: to a conspiracy to pay kickbacks and other monetary benefits to doctors in violation of the Medicare Anti-kickback Statute. The criminal fine is $30,116,592.

The plea agreement of December 2000 only resolved corporate criminal liability. As a further result of the plea agreement, two subsidiaries were excluded from participating in the Medicare Program.

By June 2003, when the action by the US Department of Justice was finally settled HCA had been required to pay out $1.7bn for defrauding the US govt and paying kickbacks to doctors.

The US govt also joined a suit against KPMG, which had allegedly helped Columbia/HCA defraud the govt and recovered $9m in fines and penalties in October 2001. KPMG denies any wrongdoing, and says they agreed to settle only to avoid the cost of litigation and put it all behind them.

Now calls itself just HCA as the previous name associated ‘with an aggressive culture’ (Health Service Journal, 060700, Howard Berliner American Booty).