Hospital to Pay $72.4 Million over 'Secret Sweetheart Deals'

Secret sweetheart deals between hospitals and physicians?

That’s how the head of the Justice Department’s Civil Division is describing a case in which Tuomey Healthcare System of Sumter, SC, will pay $72.4 million to settle a $237 million judgment. The Department of Justice alleges that the system illegally billed the Medicare program for services referred by physicians with whom the hospital had improper financial relationships.

The repercussions don’t stop there. The settlement agreement requires that Tuomey be sold to Palmetto Health in Columbia, SC.

“Secret sweetheart deals between hospitals and physicians, like the ones in this case, undermine patient confidence and drive up healthcare costs for everybody, including the Medicare program and its beneficiaries,” said Benjamin C. Mizer, JD, principal deputy assistant attorney general and head of the Justice Department’s Civil Division. Read more about this topic in the upcoming December issue of Healthcare Risk Management.