Anti-Kickback Statute

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Physician employment arrangements with hospitals have remained a significant area of regulatory scrutiny in recent months with the announcement of several high profile settlements and decisions in key FCA cases involving Stark and AKS-related issues.

In July 2016, DOJ announced a $17 million settlement in U.S. ex rel. Hammett v. Lexington County Health Services District.  The lawsuit resolved allegations that Lexington County Health Services District, Inc. d/b/a Lexington Medical Center (LMC) in West Columbia, South Carolina violated the Stark Law and FCA by acquiring physician practices and employing physicians on terms that were in excess of fair market value and on terms that were not commercially reasonable.Continue Reading FCA Issues to Watch: FCA Claims Concerning Physician Compensation

Texas-based hospital chain Tenet Healthcare Corporation and two of its Atlanta-area hospitals, Atlanta Medical Center and North Fulton Hospital, have agreed to pay more than $513 million to resolve civil and criminal claims related to violations of the federal False Claims Act (FCA) and Anti-Kickback Statute (AKS). Settlement of the underlying cases, which are styled U.S. ex rel. Williams v. Health Management Associates Inc., No. 3:09-cv-00130 (M.D. Ga.) and U.S. v. Atlanta Medical Center, Inc. No. 16-cr-00350 (N.D. Ga), are one of the largest FCA and AKS settlements this year.

On October 3, 2016, the United States filed a bill of information charging Atlanta Medical and North Fulton with one count of conspiracy to defraud the United States and pay and receive kickbacks and bribes. The government alleged that, from 2000 to 2013, Atlanta Medical and North Fulton paid prenatal clinics providing medical services to women (many of whom were undocumented, uninsured and indigent) for referrals for labor and delivery, postnatal, and infant services.  According to the government, business documents show that these referrals resulted in “extremely generous” Medicaid reimbursements and a profitable relationship between the hospitals and the clinics.
Continue Reading Tenet Healthcare Settles FCA and AKS Allegations for $513 Million

The U.S. Court of Appeals for the Sixth Circuit recently upheld a district court’s grant of summary judgment in favor of Abbott Laboratories in an action alleging that Abbott terminated a sales representative in retaliation for reporting a potential FCA violation. The appeals court held that the case should not proceed because the sales representative failed to show she reasonably believed an FCA violation had occurred. The holding potentially is helpful to FCA defendants facing retaliation allegations, but its precedential value may be limited because the court issued the unpublished opinion per curiam and with one judge dissenting.
Continue Reading Sixth Circuit Upholds Summary Judgment on FCA Retaliation Claim

What do the recent multimillion dollar FCA settlements tell healthcare providers about physician compensation arrangements? Standing alone, these settlements are cautionary examples of arrangements that may subject hospitals and physicians to increased scrutiny. These settlements, however, come on the heels of the recent OIG fraud alert – “Physician Compensation Arrangements May Result in Significant Liability,”…

From the Bass, Berry & Sims Blog Network
From the Bass, Berry & Sims Blog Network

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