LINCOLN, NEB. ? A Lincoln hospital has paid $4 million to the federal and state government to settle claims of erroneous Medicare and Medicaid reports that resulted in possible overpayments to the hospital in the 1990s.

St. Elizabeth Regional Medical Center paid $2.8 million to the federal government this month as part of a whistleblower lawsuit that has resulted in four other settlements across the country since 2002. The payment from St. Elizabeth to the federal government is the third-largest payment among the five hospitals involved thus far.

Another $1.2 million was paid to the state of Nebraska this month to settle the state component of the suit, according to Donell Martinez, director of health resources for the hospital.

“This was an error on our part, and as soon as we became aware of it, we worked collaboratively with state and federal officials to resolve it immediately,” Martinez said of the overpayments stemming from the reports filed from 1993 to 1996.

The settlement was negotiated by the U.S. Attorney’s Office and Nebraska Attorney General Jon Bruning’s office.

“St. Elizabeth’s was overpaid by Nebraska Medicaid and kept the money,” Bruning said. “The taxpayers lose when these types of payments aren’t reported.”

The hospital mischaracterized some expenses related to its neonatal and burn units in reports filed with Medicare and Medicaid, resulting in the possible overpayments to the hospital by both programs, according to a news release from the law firm that represents the whistleblower.

A California man who used to work for Medicare reimbursement consultant Healthcare Financial Advisors filed the original lawsuit in 1998. The whistleblower, Mark Razin, alleged that a number of hospitals that worked with HFA defrauded Medicare and Medicaid.

“A big warning light should have flashed when HFA offered to increase St. Elizabeth’s Medicare payments,” San Francisco attorney Michael P. Brown, an attorney with the firm that represents Razin, said in the news release. “Any time a company promises to increase a health care provider’s Medicare reimbursement, the provider has to closely examine the methods that are used to make sure they are legal.”