Tenet hospitals face federal scrutiny for alleged kickbacks

Five Tenet Healthcare Corporation hospitals in Georgia and South Carolina are under federal investigation for potential kickbacks involving a company operating prenatal clinics serving Hispanic women, the Atlanta Business Chronicle reported this week.

The Dallas-based health system disclosed it received a federal subpoena affecting Atlanta Medical Center, North Fulton Regional Hospital, South Fulton Medical Center (now Atlanta Medical Center – South Campus) and Spalding Regional Hospital, all in Georgia, and Hilton Head Hospital in South Carolina, according to its first-quarter filing with the U.S. Securities and Exchange Commission.

Federal prosecutors sought documents from January 2004 to May 2012 regarding the hospitals' relationship with Hispanic Medical Management Inc., according to the filing. Tenet said the hospitals contracted with the company for translation, marketing and Medicaid eligibility determination services.

"We have produced documents and information responsive to the subpoena and are cooperating with the government's review," Tenet said in the filing. "At this time, we are unable to determine the potential impact, if any, that will result from the final resolution of this investigation."

The subpoena was issued by the U.S. Department of Health and Human Services Office of Inspector General in Atlanta. The investigation is being conducted by two Georgia U.S. Attorney's Offices and the Department of Justice, according to the filing.

Last year Tenet Healthcare paid $42.75 million to settle allegations it had violated the Anti-kickback Statute and False Claims Act by overbilling Medicare for more than two years at 25 inpatient rehabilitation units. It was the single largest recovery related to inappropriate admissions to inpatient rehab facilities, the Justice Department said at the time. Tenet's internal compliance department had self-disclosed findings of overpayments at one of its facilities.

Meanwhile, just last month the owner and chief financial officer of Sacred Heart Hospital in Chicago, along with four affiliated physicians, were arrested on federal charges of conspiracy to pay and receive kickbacks for referrals of Medicare and Medicaid patients.

To learn more:
- read the article
- here's the SEC filing

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