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FBI, DOD Investigate USA’s Largest Psychiatric Hospital Chain Timely Insights on Laws, Issues and New Developements
DODThe FBI and Department of Defense (DOD) are investigating the USA’s largest psychiatric hospital chain.  Universal Health Services is suspected of systematically holding patients to maximize profits.  Two nurses at one of the company’s facilities raised the serious allegations after a protest at company headquarters in Pennsylvania last spring. Our law firm is investigating these reports and others for potential healthcare fraud lawsuits. 

Universal Health Services Investigated
According to three sources with direct knowledge of the investigation, officials are examining whether Universal Health Services (UHS) directs its hospitals to hold patients for as long as their insurer will pay, regardless of medical need.  BuzzFeed News reported that the probe has been ongoing since at least 2013.  That year, the Department of Health and Human Services issued subpoenas to ten UHS psychiatric hospitals.

BuzzFeed News learned last spring (2017) that the latest investigation has been broadened to include the FBI and DOD, which is scrutinizing UHS’s billings to Tricare, the insurance plan for active military members and their families.  A $12 billion company, UHS made nearly one-third of its 2016 revenues from U.S. government insurance providers like Medicare and Medicaid.

Search for Witnesses
Officials working on the investigation continue to seek witnesses to any potentially fraudulent activity.  According to BuzzFeed, an agent on the case said, “Putting together a successful prosecution will require the testimony of patients, intake coordinators, nurses, social workers, providers, and executives.”

Shareholders without a Voice
The latest allegations against UHS were raised during its shareholders meeting in the spring of 2017, by nurses who protested outside the event, along with an investor in the room.  The New York City Comptroller’s office represents pension funds that own more than $25 million in UHS stock; the NYC office referenced the government investigations into UHS as it called for the company to abandon its shareholders voting system, which fails to favor majority owners.

Two Nurses Blow Whistle on UHS
Two nurses from one UHS facility, Brooke Glen Behavioral Hospital, told BuzzFeed that they had direct experience with UHS holding patients longer than necessary to collect higher insurance payments.  The nurses recalled telling doctors that patients were safe to be discharged, but that the doctors would ask when their “last covered day” was, meaning the last day Medicare, Medicaid, or other insurance would pay for and discharge the patients, regardless of their condition.

The nurses said the doctors would sometimes have to come up with new notes to explain the extended times, such as a change in medication.

Milking Medicare & Medicaid
“If they’re on Medicare or Medicaid, they’ll (the doctors will) milk it,” said Valerie Riling, who has worked at Brooke Glen for nearly two years. “We’re not doing right by our patients.”

“They’ll admit people just to fill a bed,” said nurse Brandi George.

Last year, a BuzzFeed News investigation into UHS reported that staff in at least 14 of its hospitals said they were directed not to release patients until they had run through all available insurance funds.  Employees said that the instruction would often come in the form of the coded phrase, “Don’t leave days on the table.”

Physicians at a UHS facility in Oklahoma also told BuzzFeed News they were pushed not to release patients until their insurance days were up, especially when the hospital was operating below capacity.  That hospital has also been plagued by riots and safety issues, the investigation reported.

Because psychiatric hospitals are reimbursed for each day that a patient stays, extending patients’ stays can drive up a hospital’s profits. But billing for treatment that is not medically necessary can constitute fraud.  And patients needlessly held in locked-up places can be traumatized.

UHS Denies Any Wrongdoing

UHS has said it “absolutely rejects” BuzzFeed News’s reporting and that it does not manipulate a patient’s stay for financial gain.  UHS said its record of quality care “speaks for itself,” and that it has consistently received high-satisfaction marks from patients.

FBI Investigates

An FBI spokesperson declined to confirm or deny the investigation into UHS, but said the bureau actively pursues allegations that hospitals admit or hold patients who do not need treatment.

FBI spokesman John Althen said that in such instances, a hospital will “ignore the recommendations of its own clinicians to discharge patients, pressure the clinicians to keep patients in a hospital as long a patient’s insurance policy will pay for treatment, or employ clinicians who are complicit in the scheme.”

At least one in ten of UHS’s psychiatric facilities nationwide is now under government scrutiny. Part of the investigation has been referred to the criminal frauds section of the Department of Justice.  In 2015, the probe was expanded to UHS as a corporate entity.

UHS has described the civil investigation in filings to investors as a “False Claims Act investigation focused on billings submitted to government payers in relation to services provided at those facilities.”  UHS has not provided any details about the criminal investigation, nor has it disclosed that the DOD is among the agencies investigating.

In a response to BuzzFeed, UHS said that it “takes these matters very seriously and is cooperating with all agencies involved.”  It added, “Investigations such as these are an unfortunate but common reality facing the healthcare industry.”

UHS Settled Lawsuit with Government
In 2012, UHS settled a lawsuit that the government filed against one of the company’s youth facilities in Virginia.  A federal petition alleged that the hospital was delaying the release of patients who no longer needed care in order to increase Medicaid payments.  It charged that UHS deliberately provoked patients so that their reactions would warrant longer stays, and even altered therapists’ records to justify longer stays.

Matthews & Associates Law Firm is investigating potential cases involving psychiatric patients held against their will, beyond the therapeutic point.  If you believe that you or or someone you love has been held in a hospital beyond the therapeutic point, solely for profit, contact us for a free legal consultation.


  • Healthcare Fraud Lawsuit
  • Locked on the Psych Ward
  • Drug Injury Attorneys

by Matthews & Associates

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