Federal appeals court overturns $45M Stark ruling

In a temporary win for the South Carolina health system, the 4th U.S. Circuit Court of Appeals overturned a district ruling that required Tuomey Healthcare System to pay more than $45 million for allegedly violating the Stark Law.

"We are pleased that the 4th Circuit Court has decided that the District Court's judgment violated Tuomey's Seventh Amendment right to a jury trial, and vacated (reversed) the $50 million judgment against Tuomey Healthcare System," President and CEO Jay Cox said in a statement Saturday.

In March 2010, a jury found the hospital had committed Stark Law violations involving 18 part-time physicians working at its outpatient surgery center but it did not violate the False Claims Act.

In a June 2010 court case, Tuomey Healthcare System was slated to repay the government nearly $45 million in Medicare payments that the hospital allegedly received through physician contracts that violated Stark.

Attorneys are reviewing the 31-page federal order. If the government doesn't request for a rehearing, for which it has a month and a half to do so, the matter goes back to a South Carolina district court and Tuomey can request for its money to be released from escrow and sent back to the health system, according to Cox.

For more information:
- read the Tuomey statement
- check out the appeals decision

Related Articles:
Stark violations: Tuomey Healthcare in South Carolina ordered to pay $50 million
Stark case proceeds against SC hospital

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