Owings Mills Orthopaedic Group and Physical Therapy Group Settle Anti-Kickback Claims

October 16, 2008

Baltimore, Maryland - Advanced Centers for Orthopaedic Surgery and Sports Medicine, Inc. (“Advanced Centers”) and Maryland Sportscare and Rehabilitation, LLC (“MSR”) have agreed to collectively pay the United States $238,912.47 to settle claims that they violated the federal Anti-Kickback statute over a two and one half year period, announced United States Attorney for the District of Maryland Rod J. Rosenstein. The Anti-Kickback statute prohibits the submission of claims to a federal health care program for payment of services that are induced from a referral for the services.

United States Attorney Rod J. Rosenstein said, “Patients and taxpayers unnecessarily pay higher costs for medical care when doctors’ referral decisions are influenced by the doctors’ own financial interests.”

The Government contends in the settlement agreements that from January 2002 to October 2004, Advanced Centers referred patients to MSR for physical therapy services and paid a referral fee of $30 per patient up to 150 patients, and $36 per patient for every referral thereafter. At the same time, MSR leased space from Advanced Centers at a rate that far exceeded the fair market rate for similar spaces, in what the government contends is a kick-back scheme. The government further contends that Advanced Centers and MSR violated the False Claims Act because they knowingly submitted these claims which violated the Anti-Kickback Statute. Additionally, Advanced Centers settled “double billing” claims that were based upon the submission of multiple claims to Medicare that resulted in multiple payments for the same physical therapy service.

Both corporations denied the allegations. Advanced Centers paid $158,312.47 and MSR paid $80,000 to settle the claims.

United States Attorney Rod J. Rosenstein commended the investigative work performed by the Department of Health and Human Services Office of the Inspector General and the Office of Personnel Management Office of Inspector General. Mr. Rosenstein also thanked Assistant U.S. Attorney Thomas F. Corcoran, who handled the case.


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