Physician-Owned Forest Park Medical Center To Pay $215,000 To Resolve Kickback Allegations Under Civil Settlement With United States

Forest Park Medical Center, LLC (“FPMC”), a physician-owned hospital located in Dallas, Texas, will pay $215,000 under a civil settlement with the United States Department of Justice, announced Acting United States Attorney Richard L. Durbin, Jr.  The settlement resolves allegations that the hospital paid kickbacks in exchange for referrals of patients covered by the federal workers’ compensation program, known as FECA.

FECA, a federal health care program administered by the United States Department of Labor (“DOL”), provides workers’ compensation benefits to federal workers who suffer job-related injuries.  The program covers roughly 3 million federal civilian and postal employees.  Benefits include payment of a covered worker’s medical and rehabilitation expenses.  DOL uses federal funds to reimburse health care providers that treat injured workers covered by FECA.

The Department of Justice investigated whether FPMC violated the Anti-Kickback Statute, 42 U.S.C. § 1320a-7b(b), and submitted false claims for reimbursement to the FECA program in violation of the False Claims Act, 31 U.S.C. §§ 3729-3733.  Between August 1, 2011 and March 1, 2012, FPMC caused payments to be made to individuals and entities located in the Western District of Texas for “marketing” and “management” services.  The United States contends that these payments were, in reality, unlawful kickbacks made in exchange for the referral of patients covered by FECA in violation of the Anti-Kickback Statute.  The United States further contends that, by billing the FECA program for services rendered to patients whose referrals were secured through kickbacks, FPMC submitted false claims for payment to the DOL in violation of the False Claims Act, which provides for treble damages and civil penalties.

Under the settlement announced today, FPMC will pay $215,000 to resolve the hospital’s potential False Claims Act liability.  The settlement, which follows an earlier resolution reached with the United States Attorney’s Office for the Northern District of Texas regarding claims submitted to the TRICARE program, is not an admission of liability by FPMC or its affiliates.  FPMC cooperated with the government’s investigation.

Acting United States Attorney Durbin commended the efforts of the investigating agencies, including the United States Postal Service -- Office of the Inspector General, United States Army Criminal Investigation Division -- Major Procurement Fraud Unit, Federal Bureau of Investigation, and the United States Department of Labor -- Office of the Inspector General.  Assistant United States Attorney John J. LoCurto and Auditor Jamie Cole, CPA handled the investigation for the United States Attorney’s Office.