Here are the five biggest anti-kickback statute cases involving hospitals that made headlines in 2010.
1. Health Management Associates files motion to dismiss lawsuit alleging kickbacks and false claims — Mike Mastej, former CEO of Physicians Regional Medical Center in Naples, Fla., filed a whistleblower suit against HMA, alleging the hospital operator provided kickbacks to physicians for referrals in the form of on-call payments, reduced or free office space rentals and trips to the Masters Golf Tournament and then billed Medicare for services from these physicians. HMA argued the lawsuit failed to provide enough evidence to prove any false claims or anti-kickback violations. The Department of Justice initially investigated the original whistleblower case but chose not to intervene. Scott Becker, JD, CPA, a partner at McGuireWoods, said the success of qui tam lawsuits is much lower when the government chooses not to intervene.
2. Marion (Ohio) General Hospital pays $1.2 million to resolve allegations of Stark law and anti-kickback violations — The violations, which were self-reported by the hospital to the U.S. Attorney General's Office, included a number of financial relationships with physicians that did not involve a written contract. Specifically, the hospital provided an after-hours answering service and medical waste disposal services to independent physicians at below-market rates and provided payment without a written contract to independent physicians who treated uninsured patients, among other violations.
3. Towson, Md.-based St. Joseph Medical Center pays $22 million to resolve lawsuit involving alleged False Claims Act and anti-kickback violations — The settlement resolves allegations of the payment of kickbacks to Pikesville, Md.-based MidAtlantic Cardiovascular Associates under the guise of professional services agreements in return for the group's referrals to the medical center. The settlement specifically resolves issues related to 11 professional services agreements, covering the period of Jan. 1, 1996 to Jan. 1, 2006, which were being investigated for being above fair market value, not commercially reasonable or for services not rendered.
4. Bradford (Penn.) Regional under fire for allegedly violating the anti-kickback statute — A federal judge found BRMC guilty of violating the federal Stark Act by entering into an illegal financial relationship with two physicians and their medical practice and submitting claims to Medicare based upon referrals from them. According to the prosecution, a lease agreement between the hospital and the two physicians was not a bona fide sublease of equipment needed by the hospital, which already had its own nuclear camera, but was instead a disguised attempt to pay the physicians for patient referrals. A jury must decide whether the defendants possessed the necessary intent to be liable under the anti-kickback statute. While no decision has yet been made as to whether BRMC indeed violated the anti-kickback statute, the presiding judge in the Stark Act case stated the hospital will find it difficult to prove they did not possess intent.
5. Health Alliance of Greater Cincinnati and The Christ Hospital in Mount Auburn, Ohio, pay $108 million to settle accusations they violated the anti-kickback statute and the False Claims Act — The organizations were accused of illegally paying physicians in exchange for referring cardiac patients to The Christ Hospital, a former member hospital of the Health Alliance of Greater Cincinnati. The Christ Hospital allegedly limited the opportunity to work at the Heart Station — a center where patients receive non-invasive procedures such as electrocardiograms and stress tests — to those cardiologists who referred cardiac business to The Christ Hospital. Cardiologists were also allegedly rewarded with a percentage of time at the Heart Station based on their contributions to the hospital's yearly gross revenues, and these physicians could earn additional income for treating patients at the facility.
1. Health Management Associates files motion to dismiss lawsuit alleging kickbacks and false claims — Mike Mastej, former CEO of Physicians Regional Medical Center in Naples, Fla., filed a whistleblower suit against HMA, alleging the hospital operator provided kickbacks to physicians for referrals in the form of on-call payments, reduced or free office space rentals and trips to the Masters Golf Tournament and then billed Medicare for services from these physicians. HMA argued the lawsuit failed to provide enough evidence to prove any false claims or anti-kickback violations. The Department of Justice initially investigated the original whistleblower case but chose not to intervene. Scott Becker, JD, CPA, a partner at McGuireWoods, said the success of qui tam lawsuits is much lower when the government chooses not to intervene.
2. Marion (Ohio) General Hospital pays $1.2 million to resolve allegations of Stark law and anti-kickback violations — The violations, which were self-reported by the hospital to the U.S. Attorney General's Office, included a number of financial relationships with physicians that did not involve a written contract. Specifically, the hospital provided an after-hours answering service and medical waste disposal services to independent physicians at below-market rates and provided payment without a written contract to independent physicians who treated uninsured patients, among other violations.
3. Towson, Md.-based St. Joseph Medical Center pays $22 million to resolve lawsuit involving alleged False Claims Act and anti-kickback violations — The settlement resolves allegations of the payment of kickbacks to Pikesville, Md.-based MidAtlantic Cardiovascular Associates under the guise of professional services agreements in return for the group's referrals to the medical center. The settlement specifically resolves issues related to 11 professional services agreements, covering the period of Jan. 1, 1996 to Jan. 1, 2006, which were being investigated for being above fair market value, not commercially reasonable or for services not rendered.
4. Bradford (Penn.) Regional under fire for allegedly violating the anti-kickback statute — A federal judge found BRMC guilty of violating the federal Stark Act by entering into an illegal financial relationship with two physicians and their medical practice and submitting claims to Medicare based upon referrals from them. According to the prosecution, a lease agreement between the hospital and the two physicians was not a bona fide sublease of equipment needed by the hospital, which already had its own nuclear camera, but was instead a disguised attempt to pay the physicians for patient referrals. A jury must decide whether the defendants possessed the necessary intent to be liable under the anti-kickback statute. While no decision has yet been made as to whether BRMC indeed violated the anti-kickback statute, the presiding judge in the Stark Act case stated the hospital will find it difficult to prove they did not possess intent.
5. Health Alliance of Greater Cincinnati and The Christ Hospital in Mount Auburn, Ohio, pay $108 million to settle accusations they violated the anti-kickback statute and the False Claims Act — The organizations were accused of illegally paying physicians in exchange for referring cardiac patients to The Christ Hospital, a former member hospital of the Health Alliance of Greater Cincinnati. The Christ Hospital allegedly limited the opportunity to work at the Heart Station — a center where patients receive non-invasive procedures such as electrocardiograms and stress tests — to those cardiologists who referred cardiac business to The Christ Hospital. Cardiologists were also allegedly rewarded with a percentage of time at the Heart Station based on their contributions to the hospital's yearly gross revenues, and these physicians could earn additional income for treating patients at the facility.