Overpayments to referring physicians cost hospital $3.3 million

Yet another hospital has settled allegations of False Claims Act violations. Wilmington-based Christiana Care Health System (CCHS), Delaware's largest healthcare provider, will pay the federal and state governments a combined $3.3 million, as well as entering into a corporate integrity agreement, to resolve allegations that CCHS submitted false claims to Medicare and Medicaid in violation of federal and state False Claims Acts.

In April 2005, two neurologists filed a whistleblower lawsuit alleging that CCHS certified that it was compliant with all federal and state laws and regulations when the health system "knew that it had an impermissible financial relationship with a group of Wilmington, Delaware neurologists who referred patients," says U.S. Attorney's Office for the District of Delaware.

CCHS allegedly paid the neurology group fees "significantly higher than (and, in some cases, multiples of) the amount Medicare and Medicaid paid CCHS as reimbursement for those services"--in violation of both as the federal Physician Self-Referral Statute (i.e., the Stark Statute) and the Delaware Anti-Kickback Statute, says the office.

Under the Stark Statute, hospitals cannot profit from patient referrals made by physicians with whom the hospital has an impermissible financial relationship. The Delaware Anti-Kickback Statute prohibits a hospital from paying a physician to induce that physician to make referrals.

"Christiana Care admitted no wrongdoing in this case," says Christiana spokesman William Schmitt. "We...voluntarily provided considerable quantities of records to the government, none of which were found by the Office of the Inspector General to substantiate any of the allegations. The case alleged that Christiana Care overpaid a medical group for services. Importantly, this case did not involve claims...that Christiana Care was billing for services that it did not provide or that it was billing for services that were not medically necessary. Nor did it involve improper influence on physician decision-making or compromise patient care in any way."

To learn more:
- read the News Journal article
- see the Department of Justice press release

Suggested Articles

CVS Health is joining forces with UPS to test several different applications for drone delivery, including sending products directly to patients.

Cleveland Clinic and telehealth company American Well are launching a Cleveland-based joint venture telehealth company.

Humana and Microsoft announced a seven-year strategic partnership to build predictive solutions and intelligent automation to support Humana members.