Tennessee-based Hospital Corporation of America (HCA) has agreed to pay $16.5 million to settle claims that it violated the False Claims Act and the Stark statute in 2007, the U.S. Department of Justice announced yesterday.
The biggest U.S. hospital operator, through subsidiaries Chattanooga's Parkridge Medical Center and Nashville's HCA Physician Services, allegedly gave financial benefits to Diagnostic Associates of Chattanooga to entice the physician group to refer patients to HCA facilities.
"Improper business deals between hospitals and physicians jeopardize both patient care and federal program dollars," Daniel R. Levinson, the U.S. Department of Health & Human Services' Inspector General, said in a statement. "Our investigators continue to work shoulder to shoulder with other law enforcement authorities to stop schemes that imperil scarce healthcare resources."
Parkridge has not admitted intentional wrongdoing but agreed to enter into a five-year corporate integrity agreement to comply with state and federal anti-kickback laws, Chattanooga Times Free Press reported.
Because the settlement stemmed from a 2008 whistleblower case, the whistleblower will get 18.5 percent of the recovery--$3.1 million. HCA also will pay $236,000 to cover the whistleblower's legal fees.
The civil settlement comes on the heels of federal allegations that HCA aggressively performed cardiac services at 10 of its Florida hospitals for higher reimbursements.
Meanwhile, it seems the industry has been rife with alleged False Claims Act violations. Last month, Chattanooga-based Memorial Health Care System agreed to pay more than $1 million to settle claims that its patient referral practices violated the False Claims Act and other federal regulations. That same day, Los Angeles hospital chain Pacific Health Corp. pleaded guilty to conspiring to defraud Medicare and Medi-Cal by paying $2.3 million in kickbacks to recruiters to find homeless people to act as patients.