Department of Justice Seal Department of Justice
TUESDAY, JULY 18, 2006
(202) 514-2007
TDD (202) 514-1888

Marion County Medical Center to Pay U.S. $3.75 Million
to Resolve Kickback Allegations

WASHINGTON – Marion County Medical Center in Marion County, S.C. has agreed to pay the United States $3.75 million to resolve allegations of health care fraud against the government, the Justice Department announced today. The settlement resolves allegations that Marion County Medical Center submitted false claims to Medicare, Medicaid and TRICARE, the U.S. military’s health care program, by engaging in financial relationships with certain physicians that were prohibited under the Stark Law and/or the Anti-kickback Statute.

Specifically, the settlement focuses on the compensation Marion paid to two physicians which the United States contends far exceeded the fair market value of the services provided by those physicians and was not commercially reasonable. The settlement also resolves allegations that Marion submitted claims to Medicare for professional services for initial hospitalizations which were coded at a level higher than the services that were provided.

"This settlement reflects the importance that the Department places on compliance by all health care providers with the law, including those laws governing financial relationships between hospitals and physicians,” said Peter D. Keisler, Assistant Attorney General for the Department of Justice's Civil Division. “We will continue to apply the False Claims Act to protect the federal healthcare programs against the potential for fraud and abuse posed by such prohibited relationships."

The United States initiated the investigation in response to a whistleblower action brought by Kenneth Orbeck, a former employee of Marion. Under the False Claims Act, private individuals can bring whistleblower actions for fraud on behalf of the United States and collect a share of any proceeds recovered by the suit and attorney fees. Mr. Orbeck will receive $610,000 as his share of the settlement.

"We are pleased to have been able to resolve this matter,” said U.S. Attorney Reginald I. Lloyd of the District of South Carolina. “ The government greatly appreciates and applauds the conscientious efforts of whistleblowers like Dr. Orbeck who bring issues of fraud and abuse to the attention of the government.”

The settlement is the culmination of a joint investigation involving agents, attorneys and auditors from the United States Attorneys Office in Columbia, S.C.; the Department of Justice; the Office of the Inspector General, Department of Health and Human Services; the Federal Bureau of Investigation; and the Defense Criminal Investigative Service.

The case is entitled United States ex rel Kenneth Orbeck v. Marion County Medical Center; Case No. 3:04-22599-22 (D.S.C.).