Adventist Health System, based in Altamonte Springs, FL, has agreed to pay the United States $115 million to settle allegations that it violated the False Claims Act by maintaining improper compensation arrangements with referring physicians and by miscoding claims, the Justice Department announced recently.
Adventist is a non-profit healthcare organization that operates hospitals and other healthcare facilities in 10 states.
Principal Deputy Assistant Attorney General Benjamin C. Mizer, JD, head of the Justice Department’s Civil Division, announced the settlement. “Unlawful financial arrangements between healthcare providers and their referral sources raise concerns about physician independence and objectivity,” Mizer said. “Patients are entitled to be sure that the care they receive is based on their actual medical needs rather than the financial interests of their physician.”
The settlement resolves allegations that Adventist submitted false claims to the Medicare and Medicaid programs for services rendered to patients referred by employed physicians who received bonuses based on a formula that improperly took into account the value of the physicians’ referrals to Adventist hospitals. Adventist-owned hospitals allegedly paid doctors’ bonuses based on the number of tests and procedures they ordered, said Acting U.S. Attorney Jill Westmoreland Rose, JD, of the Western District of North Carolina.
“This type of financial incentive is not only prohibited by law, but can undermine patients’ medical care. Would-be violators should take notice that my office will use the False Claims Act to prevent and pursue health care providers that threaten the integrity of our health care system and waste taxpayer dollars.”
The settlement also resolves allegations that Adventist submitted bills to Medicare for its employed physicians’ professional services containing certain improper coding modifiers, and thereby obtained greater reimbursement for these services than entitled.
The allegations arose from two lawsuits that were filed respectively by whistleblowers who worked at an Adventist hospital in Hendersonville, NC, and another whistleblower who worked at the corporate office of Adventist, under the qui tam provisions of the False Claims Act. The act permits private parties to file suit on behalf of the United States for false claims and to share in any recovery. The whistleblowers’ share of the settlement has not yet been determined.
More information on the settlement is available online at http://tinyurl.com/pfb2bct.
