Ohio-Based Health System Pays United States $10 Million to Settle False Claims Act Allegations
Robinson Health System Inc. has agreed to pay $10 million to settle claims that it violated the False Claims Act, the Anti-Kickback Statute and the Stark Statute by engaging in improper financial relationships with referring physicians, the Justice Department announced today. Robinson is a nonprofit corporation based in Ohio that operates a number of health care facilities in Portage County, Ohio, including Robinson Memorial Hospital.
“The Department of Justice has longstanding concerns about improper financial relationships between health care providers and their referral sources, because such relationships can alter a physician’s judgment about the patient’s true health care needs and drive up health care costs for everybody,” said Acting Assistant Attorney General Benjamin C. Mizer of the Justice Department’s Civil Division. “In addition to yielding a recovery for taxpayers, this settlement should deter similar conduct in the future and help make health care more affordable.”
The settlement announced today involved Robinson’s financial relationships with a number of referring physicians that allegedly violated the Anti-Kickback Statute and the Stark Statute, both of which restrict the financial relationships that hospitals may have with doctors who refer patients to them. These relationships included management agreements that Robinson had with two physicians groups. These physicians allegedly failed to provide sufficient bona fide management services to have justified the payments that they received. Robinson disclosed these issues to the government.
“Referrals should be made to the best qualified physicians, and must be based on what’s best for the patient,” said U.S. Attorney Steven M. Dettelbach of the Northern District of Ohio. “Improper financial relationships between hospitals and referring doctors can lead to clouded judgments, which is why the Department of Justice will continue to police such matters vigorously.”
This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act, which prohibits false claims for federal funds, including claims submitted in violation of the Anti-Kickback Statute and the Stark Statute. Since January 2009, the Justice Department has recovered a total of more than $23.9 billion through False Claims Act cases, with more than $15.2 billion of that amount recovered in cases involving fraud against federal health care programs.
The case was handled by the Justice Department’s Civil Division, the U.S. Attorney’s Office for the Northern District of Ohio, and the Department of Health and Human Services’ Office of Inspector General. The claims settled by this agreement are allegations only, and there has been no determination of liability.