United States Attorney Richard B. Roper
Northern District of Texas

HARDEMAN COUNTY MEMORIAL HOSPITAL TO PAY U.S. TO RESOLVE ALLEGATIONS IT BENEFITTED FROM IMPROPER PHYSICIAN REFERRALS

DALLAS — Hardeman County Memorial Hospital (Hardeman), located in Quanah, Texas, has agreed to pay the U.S. a total of $398,230.56 to resolve allegations that it violated the civil False Claims Act, announced U.S. Attorney Richard B. Roper of the Northern District of Texas. Hardeman allegedly violated the civil False Claims Act by submitting improper claims for payment to the Medicare program between January 1, 1994, and December 31, 2005, for health care items and services provided to patients referred as a result of improper physician referrals. By entering into such a settlement, Hardeman does not admit any wrongdoing and denies all liability.

In 2005, Hardeman self-disclosed to the Office of Inspector General for the Department of Health and Human Services (OIG) that a physician-lease arrangement Hardeman discovered during a review of its physician relationships implemented by new management potentially violated federal law. The self-disclosure prompted an investigation, during which Hardeman cooperated fully with the government. Based on information provided by Hardeman, the U.S. concluded Hardeman was paid substantial sums by the Medicare program for health care items and services referred to Hardeman by a physician who had received free rent from Hardeman. However, because of Hardeman’s demonstrated ongoing financial difficulties, the U.S. agreed to reduce significantly the settlement amount and allow the facility to make payments over two years.

As part of the settlement, Hardeman also entered into a three-year Corporate Integrity Agreement (CIA) with the OIG. The CIA requires Hardeman to adhere to certain policies and procedures to ensure compliance with applicable statutes and regulations that govern the use of federal health care funds.

U.S. Attorney Roper praised the investigative efforts of the OIG. The case was handled by Assistant U.S. Attorney Sean R. McKenna.

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