Justice News

Department of Justice
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Friday, September 9, 2011

U.S. Joined False Claims Act Lawsuit Against Florida’s Halifax Hospital Medical Center and Halifax Staffing Inc.

WASHINGTON – The United States has partially intervened in a lawsuit under the False Claims Act against Halifax Hospital Medical Center and Halifax Staffing Inc. in the U.S. District Court for the Middle District of Florida, the Department of Justice announced today.


The government partially intervened with respect to allegations that Halifax, which is located in Daytona Beach, Fla., violated the Stark law, which prohibits a hospital from billing Medicare for services referred by physicians that have an improper financial relationship with the hospital. The United States alleges that Halifax’s contracts with three neurosurgeons and six medical oncologists were improper, in part, because they either paid physicians more than fair market value, were not commercially reasonable or took into consideration the volume or value of the physicians’ referrals.


 “Improper financial arrangements between hospitals and physicians threaten patient safety because personal financial considerations, instead of what's best for the patient, can influence the type of health care that is provided,” said Tony West, Assistant Attorney General for the Civil Division of the Department of Justice. “The department is committed to preventing kickbacks that can corrupt the integrity of health care delivery.”


“The Stark law was enacted to prevent financial ties between a physician and an entity providing health care services from influencing the level of care provided to a patient,” said Robert E. O’Neill, U.S. Attorney for the Middle District of Florida. “By bringing cases such as this one, we hope to ensure that precious health care resources are not being wasted as a result of questionable financial relationships between health care providers.”


The lawsuit was initially filed in July 2009 by Elin Baklid-Kunz, currently employed at Halifax Staffing as the director of physician services, under the whistleblower provisions of the False Claims Act. Those provisions authorize private parties to sue on behalf of the United States, and permit the United States to intervene and take over the lawsuit. The whistleblower is entitled to receive a portion of any recovery. In this case, the United States elected to intervene in only a portion of the allegations asserted by Ms. Baklid-Kunz. 


The government’s involvement in this case is part of the United States’ emphasis on combating health care fraud and another step for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced by Attorney General Eric Holder and Kathleen Sebelius, Secretary of the Department of Health and Human Services in May 2009. 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 that effort is the False Claims Act, which the Justice Department has used to recover more than $5.9 billion since January 2009 in cases involving fraud against federal health care programs. The Justice Department’s total recoveries in False Claims Act cases since January 2009 are more than $7.5 billion.

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Updated September 15, 2014