Hospital pays Uncle Sam $8.5 million to settle kickback fraud case

Memorial Hospital in Ohio Pays Government $8.5 Million to Settle False Claims Act Allegations that it violated the False Claims Act, the Anti-Kickback Statute and the Stark Statute by engaging in improper financial relationships with referring physicians, the Justice Department announced today.

“Improper financial relationships between health care providers and their referral sources can undermine physicians’ judgment about patients’ true health care needs and drive up health care costs for everyone,” said Assistant Attorney General for the Justice Department’s Civil Division Stuart F. Delery.  “The Justice Department is firmly committed to recovering the taxpayer dollars lost due to these arrangements and making sure that all health care providers follow the rules.” 

The Anti-Kickback Statute and the Stark Statute restrict the financial relationships that hospitals may have with doctors who refer patients to them.

The settlement announced today involved allegations that financial relationships that Memorial had with two physicians – a joint venture between Memorial and a pain management physician and an arrangement under which an ophthalmologist purchased intraocular lenses and then resold them to Memorial at inflated prices – violated statutory requirements.  These issues were disclosed to the government by Memorial.

 The improper referrals at issue in this matter included Medicaid patients.  Medicaid is funded jointly by the states and the federal government.  

Jeffrey A. Newman represents whistleblowers