File photo of Maine Medical Center, the state's largest hospital and a facility in the MaineHealth system.

PORTLAND, Maine — The state’s largest hospital and ambulance provider have agreed to pay the federal government $1.425 million to settle claims that the emergency transport company defrauded Medicare by filing false or misleading bills for hundreds of ambulance rides that were not medically required.

North East Mobile Health Service, of Scarborough, will pay $825,000 to settle allegations that that it violated the False Claims Act, the U.S. Attorney for the District of Maine announced Friday. The Portland-based Maine Medical Center agreed to pay $600,000 to close a separate civil case claiming it provided the ambulance company with inaccurate information that was then used to bill the federal government.

Both groups cooperated with an Inspector General’s investigation and neither admitted any wrongdoing as part of the settlements, according to court records.

In the case, the federal government alleged that North East improperly billed Medicare for transporting patients who it falsely claimed were confined to their beds or for whom such transportation was otherwise medically necessary, according to a statement from U.S. Attorney Halsey Frank.

The settlements were the “unfortunate result of a legal process that at times penalizes hospitals for prioritizing safe patient care,” Maine Medical spokesman Clay Holtzman said in a statement.

The settlement agreement states that North East and Maine Medical agreed to the payout to “avoid delay, uncertainty, inconvenience, and expense of protracted litigation.”

An unidentified “independent reviewer” found that the hospital had no financial incentive to order ambulance transfer for Medicare patients and “saw no financial gain as a result of the disputed charges,” according to Holtzman.

North East’s settlement also resolved allegations that it knowingly retained Medicare overpayments, Frank said.

Jason Sulham, a spokesman for the ambulance company, said that it had transported all the patients in question after receiving “required documentation from medical personnel” saying such transport was needed. An Inspector General’s investigation later determined the cases did not meet Medicare’s definition of “medically necessary,” he said.

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