The parent company of Shasta Regional Medical Center is being sued by the U.S. Department of Justice, which accuses it of Medicare fraud. The suit says prime healthcare ordered newly acquired hospitals to arbitrarily admit 20 to 30% of patients who came into their emergency rooms regardless of whether they needed inpatient treatment, but only if they were covered by Medicare. That's because Medicare inpatient reimbursement rates are much higher than outpatient rates. The suit also alleges that Prime Healthcare administrators used deception, incentives and coercion on doctors to pressure them to admit as many Medicare patients as possible. Under the policy, uninsured patients were allegedly allowed to languish in the emergency room for hours and then discharged. Prime Healthcare strongly denies the allegations.