United States Files Lawsuit Against West Virginia Hospital, Its Management Company, and Its CEO Based on Kickbacks and Other Improper Payments to Physicians
The United States filed a complaint under the False Claims Act against Wheeling Hospital Inc., R & V Associates Ltd. (R & V), and Ronald Violi in the U.S. District Court for the Western District of Pennsylvania, the Department of Justice announced today. The government alleges that Wheeling Hospital, which is located in Wheeling, West Virginia, violated the Stark Law and Anti-Kickback Statute, and that those violations were caused by R & V, Wheeling’s contracted management consultant, and Violi, Wheeling’s CEO.
The Stark Law prohibits a hospital from billing Medicare for services referred by physicians who have improper financial relationships with the hospital. The Anti‑Kickback Statute prohibits offering or paying anything of value to induce the referral of items or services covered by Medicare, Medicaid, and other federal healthcare programs. The United States alleges that Wheeling’s compensation to a number of employed and contracted physicians violated these statutory prohibitions because that compensation was based on the volume or value of the physicians’ referrals or exceeded the fair market value of the physicians’ services.
“Improper financial arrangements between hospitals and physicians can influence the type and amount of health care that is provided,” said Assistant Attorney General Jody Hunt of the Department of Justice’s Civil Division. “The Department is committed to taking action to eliminate improper inducements that can corrupt the integrity of physician decision-making and drive up healthcare costs.”
“Medicare and Medicaid beneficiaries trust that their healthcare providers will make decisions based on sound medical judgment,” said U.S. Attorney Scott W. Brady. “Our office will take decisive action against any medical providers who betray that trust and make medical decisions based on their own financial interests.”
The United States filed its complaint in a lawsuit filed under the qui tam, or whistleblower, provisions of the False Claims Act. Those provisions authorize private parties to sue on behalf of the United States for false claims and share in any recovery. The Act permits the United States to intervene and take over the lawsuit, as it did here in part.
The government’s intervention in this matter illustrates the government’s emphasis on combating healthcare fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse, and mismanagement can be reported to the Department of Health and Human Services, at 800‑HHS‑TIPS (800-447-8477).
This matter was investigated by the Civil Division’s Commercial Litigation Branch, the U.S. Attorney’s Office for the Western District of Pennsylvania, the U.S. Department of Health and Human Services Office of Inspector General, and the FBI.
The case is captioned United States of America ex rel. Louis Longo v. Wheeling Hospital, Inc. et al., No. 17-cv-1654 (W.D. Pa.). The claims asserted against defendants are allegations only and there has been no determination of liability.