Healthcare FMV Advisors News & Updates

Author: admin Created: 10/22/2009 12:57 PM
News & Updates on FMV compliance issues brought to you by Healthcare FMV Advisors, LLC.

NEWARK, N.J. – The Cooper Health System has agreed with the U.S. Attorney’s Office for the District of New Jersey and the State of New Jersey to pay $12.6 million to settle allegations that it violated the federal False Claims Act and New Jersey False Claims Act by making improper payments to physicians under so-called “consulting” and “compensation” agreements as it sought to build its cardiology program. U.S. Attorney Paul J. Fishman, Executive Assistant N.J. Attorney General John Hoffman, and Thomas O’Donnell, Special Agent in Charge of the U.S. Department of Health and Human Service's Office of Inspector General region that includes New Jersey, announced the settlement, which was unsealed today. “Payments to outside physicians by hospitals require heightened scrutiny because those payments may be improper if they are based on patient referrals,” said U.S. Attorney Fishman. “Such kickback arrangements interfere with the physician-patient relationship and can lead to problems of overutilization and increased...

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WASHINGTON - The government has intervened in eight False Claims Act lawsuits against Health Management Associates Inc. (HMA) alleging that HMA billed federal health care programs for medically unnecessary inpatient admissions from the emergency departments at HMA hospitals and paid remuneration to physicians in exchange for patient referrals, the Justice Department announced today. The government also has joined in the allegations in one of these lawsuits that Gary Newsome, HMA's former CEO, directed HMA's corporate practice of pressuring emergency department physicians and hospital administrators to raise inpatient admission rates, regardless of medical necessity. HMA operates 71 hospitals in 15 states: Alabama, Arkansas, Florida, Georgia, Kentucky, Mississippi, Missouri, North Carolina, Oklahoma, Pennsylvania, South Carolina, Tennessee, Texas, Washington and West Virginia.

Concerning an arrangement in which a hospital pays a cardiology group compensation that includes a performance bonus based on implementing certain patient service, quality, and cost savings measures associated with procedures performed at the hospital's cardiac catheterization laboratories.

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Concerning a hospital's proposal to provide free access to an electronic interface to community physicians and physician practices that would allow those physicians and practices to transmit orders for certain services to, and receive the results of those services from, the hospital.

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The OIG alleged that ForTec provided customers (including physicians) an all-expense paid trip to the Masters Golf Tournament. The OIG concluded that the trips were intended to induce referrals.

The OIG alleged that CMC paid remuneration to three orthopedists in the form of improper payments for on-call coverage, malpractice insurance, travel reimbursement, and overpayments under an income guarantee agreement.

The OIG alleged that the problematic arrangements included leases with doctors, medical directorships, personal services contracts and loans to referral sources.

The $6.9 billion in expected recoveries consists of $923.8 million in audit receivables and $6 billion in investigative receivables. In addition, OIG reported $8.5 billion in estimated savings resulting from legislative, regulatory, or administrative actions that were supported by our recommendations. Such savings generally reflect third-party estimates (such as those by the Congressional Budget Office) of funds made available for better use through reductions in Federal spending.

OIG also excluded 3,131 individuals and entities from participation in Federal health care programs in FY 2012. OIG reported 778 criminal actions against individuals or entities that engaged in crimes against HHS programs; and 367 civil actions, which include false claims and unjust enrichment lawsuits filed in Federal district court, civil monetary penalties settlements, and administrative recoveries related to provider self-disclosure matters.

OIG issued an advisory opinion concerning an existing arrangement under which a hospital pays a per diem fee to physicians for providing on-call coverage for the hospital's emergency department.

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Freeman Health System, a healthcare provider and hospital system located in Joplin, Mo., has agreed to pay $9,316,139 to resolve allegations that it violated the Stark Law and the False Claims Act by knowingly providing incentive pay to physicians in a manner that violated federal law, the Justice Department announced today. The Stark Law forbids a hospital from billing Medicare for certain services referred by physicians that have a financial relationship with the hospital. A prohibited financial relationship includes an agreement between a hospital and a physician to compensate a physician based on the volume of the physician’s referrals or the revenue realized through those referrals. Freeman disclosed to the U.S. Attorney for the Western District of Missouri that a number of its physicians were eligible for incentive compensation that may have taken into account the value and volume of their referrals. Based on its investigation of Freeman’s disclosures, the United States alleged that Freeman knowingly...

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