By Lookout Staff

August 26, 2010 -- Saint John's Medical Center agreed Wednesday to pay the federal government $5.25 million to resolve allegations that it submitted inflated claims to Medicare between 1996 and 2003.

The hospital, which did not admit any wrongdoing, will make the payment by August 30.

The U.S. Attorney alleges the Santa Monica hospital billed dramatically increased charges that exceeded the costs associated with care provided to the Medicare inpatients.

The case involved "outlier payments" designed to compensate hospitals for providing extraordinarily costly care to patients, said Assistant United States Attorney Cathy Ostiller.

A Santa Monica institution, Saint John's Medical Center has been largely rebuilt since its half-century old facilities were battered in the 1994 Northridge Earthquake.

It has long been the hospital of choice for such major figures as the late President Ronald Reagan and entertainers Micheal Jackson and Elizabeth Taylor.