May 21, 2010, WASHINGTON - The Health Alliance of Greater Cincinnati and one of its former member hospitals, The Christ Hospital, have agreed to pay the United States $108 million to settle claims that they violated the Anti-Kickback Statute and the False Claims Act by paying unlawful remuneration to doctors in exchange for referring cardiac patients to The Christ Hospital in a pay-to-play scheme, the Justice Department announced today.
The United States alleged that The Christ Hospital, a 555-bed acute care hospital located in Mount Auburn, Ohio, limited the opportunity to work at the Heart Station - an outpatient cardiology testing unit that provides non-invasive heart procedures - to those cardiologists who referred cardiac business to The Christ Hospital. The government further alleged that cardiologists whose referrals contributed at least two percent of the hospital's yearly gross revenues were rewarded with a corresponding percentage of time at the Heart Station, where they had the opportunity to generate additional income by billing for the patients they treated at the unit and for any follow-up procedures that these patients required.
The government asserted that The Christ Hospital's use of Heart Station panel time to induce lucrative cardiac referrals violated the federal Anti-Kickback Statute, which prohibits a hospital from offering or paying, or a physician from soliciting or receiving, anything of value in return for patient referrals. The United States also alleged that the claims The Christ Hospital submitted to Medicare and Medicaid as a result of this illegal kickback scheme constituted a violation of the False Claims Act.
"Health care providers should make medical decisions based on the needs of their patients, not on the financial interests of physicians or other providers," said Tony West, Assistant Attorney General for the Civil Division of the Department of Justice. "We will not allow hospitals to put profits ahead of sound medical decision-making."
The allegations resolved by today's settlement were initiated by a whistleblower lawsuit filed under the qui tam provisions of the False Claims Act, which allow private parties to file actions on behalf of the United States and share in any recovery. The whistleblower in this suit, Dr. Harry Fry, a cardiologist who formerly worked at The Christ Hospital, will receive $23.5 million.
"The False Claims Act is a valuable tool in deterring fraud, waste, and abuse in government," stated Acting U.S. Attorney for this case William E. Hunt."The law was put to good use in this case as the government was able to recover from those who sought to gain financially by jeopardizing the integrity of the health care system."
Assistant Attorney General West noted that this settlement was the result of a coordinated effort among the Justice Department's Civil Division, the U.S. Attorney's Office for the Southern District of Ohio, the Office of the Inspector General of the U.S. Department of Health and Human Services, the Center for Medicare and Medicaid Services, and the FBI.
In joining today's announcement, Daniel R. Levinson, Inspector General of the Department of Health and Human Services Office of Inspector General stated, "kickbacks can distort clinical decisions, cause overutilization, increase costs, and threaten the quality of care provided to beneficiaries. The OIG, and its law enforcement partners, are committed to protecting the integrity of our federal health care programs and the health and welfare of the beneficiaries of those programs."
Because The Christ Hospital declined to enter into a Corporate Integrity Agreement acceptable to the OIG, the OIG did not provide a release of its administrative exclusion authorities and is further evaluating the matter.
This settlement is part of the government's emphasis on combating health care fraud. One of the most powerful tools in that effort is the False Claims Act, which the Justice Department has used to recover approximately $2.8 billion since January 2009 in cases involving fraud against federal health care programs. The Justice Department's total recoveries in False Claims Act cases since January 2009 have topped $3.7 billion.