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Press Release

Paul D. Weir, John R. Morgan, M.D., Care Plus Management, LLC, and Anesthesia entities pay $7.2 million to resolve kickback and False Claims Act allegations

For Immediate Release
U.S. Attorney's Office, Northern District of Georgia

ATLANTA – Paul D. Weir, John R. Morgan, M.D. and the company they created, Care Plus Management, LLC (“Care Plus”), along with 18 anesthesia entities that Care Plus owned and operated, agreed to pay $7.2 million to resolve allegations that they entered into kickback arrangements with referring physicians in exchange for the referral of the physicians’ patients for anesthesia services.  Specifically, Weir and Morgan, through Care Plus, shared the revenue received for anesthesia services with the referring physicians, and provided subsidies for drugs, supplies and equipment to the referring physicians’ outpatient surgical centers.

“A physician’s selection of an anesthesia provider for the patients he or she treats should be motivated by the quality of the anesthesia provider rather than by the income the physician can generate for him or herself,” said U.S. Attorney Kurt R. Erskine. “By offering remuneration to physicians, an anesthesia provider improperly affects the physician’s decision-making process for selecting an anesthesia provider for his or her patients.”

“Health care providers using kickbacks to boost their profits threaten the impartiality of medical decision-making, the financial integrity of Medicaid, and the public’s trust in the health care system,” said Special Agent in Charge Tamala E. Miles, U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG).  “Our agency will continue to work with our law enforcement partners to uproot such fraud schemes and hold those responsible accountable.”

“Kickback schemes can undermine our healthcare system, compromise medical decisions, and waste taxpayer dollars,” said Phil Wislar, Acting Special Agent in Charge of FBI Atlanta. “The FBI will continue to work with our law enforcement partners to ensure that all medical providers properly follow health care rules and regulations.”

“Medical professionals who enter into arrangements solely to enhance their own profits undermine the public’s faith in our healthcare system,” said Georgia Attorney General Chris Carr. “By joining forces with our federal partners and those who bring these issues to our attention, our Medicaid Fraud Division is working vigorously to ensure that the integrity of our Medicaid program is not comprised in any way. On behalf of the people of Georgia, we remain vigilant in our efforts to uncover fraud or abuse in our publicly-funded healthcare programs and will continue fighting to protect taxpayer dollars.”

Anesthesia providers typically depend on hospitals and outpatient surgery centers for their income.  If an anesthesia provider can secure an exclusive contract for anesthesia services with a center, it is guaranteed a steady stream of patient referrals during the term of the contract.  As a result, anesthesia providers compete aggressively for these contracts.

The Government alleges that between 2012 and 2016, Weir and Morgan, through Care Plus, induced the physician owners of outpatient surgery centers to award these exclusive services agreements to them by offering them a partial ownership in the anesthesia entities that Care Plus had created to service their surgery centers.  Under this arrangement, the physician owners received compensation in the form of a portion of the revenue from the anesthesia services.  

The Government further alleges that during this same period, Weir, Morgan, Care Plus and its anesthesia companies subsidized the cost incurred by surgery centers for drugs, supplies and equipment in order to induce the physician owners of those centers to grant exclusive anesthesia services agreements to Care Plus’s anesthesia companies.  HHS-OIG has longstanding concerns about the provision of free or below-fair-market-value goods or services to an existing or potential referral source.  Indeed, free or below-fair-market-value goods or services may be used as a vehicle to disguise or confer an unlawful payment for referrals of Federal health care program business.

The Government alleges that these arrangements violated the Anti-Kickback Statute, 42 U.S.C. § 1320a-7b(b), and caused the submission of false claims in violation of the False Claims Act, 31 U.S.C. § 3729, et seq.

This settlement resolves a lawsuit originally filed in the U.S. District Court for the Northern District of Georgia by Robert Douglas (the Relator) under the qui tam or whistleblower provisions of the False Claims Act.  United States ex rel. Douglas, et al. v. Care Plus Management, LLC, et al., No. 1:16-cv-4439-WMR.  Under the False Claims Act, private citizens may bring suit for false claims on behalf of the United States and share in any recovery obtained by the government.  The Relator has received over $1.3 million from the settlement.

The claims resolved by the settlement are allegations only, and there has been no determination of liability.

This case was investigated by the U.S. Attorney’s Office for the Northern District of Georgia, the U.S. Department of Health and Human Services Office of Inspector General and the Georgia Attorney General's Office Medicaid Fraud Control Unit.

The civil settlement was reached by Assistant U.S. Attorneys Neeli Ben-David and Mellori Lumpkin-Dawson, and Georgia Senior Assistant Attorney General Jim Mooney. 

For further information please contact the U.S. Attorney’s Public Affairs Office at USAGAN.PressEmails@usdoj.gov or (404) 581-6016.  The Internet address for the U.S. Attorney’s Office for the Northern District of Georgia is http://www.justice.gov/usao-ndga.

Updated April 13, 2022

Topics
False Claims Act