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Press Release

Union General Hospital to pay $5 million to resolve alleged False Claims Act violations

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

ATLANTA – Union General Hospital (“UGH”), located in Blairsville, Georgia, has agreed to pay $5 million to resolve allegations that it violated the False Claims Act by engaging in improper financial relationships with referring physicians.

“It is imperative that all medical decisions are based on the best interest of the patient not on financial gain,” said U.S. Attorney Byung J. “BJay” Pak.  “This settlement demonstrates our commitment to ensuring healthcare providers stay focused on the patient and not enriching themselves.”

“It is a priority for the FBI to protect taxpayers from those who would circumvent our healthcare laws,” said Chris Hacker, Special Agent in Charge of FBI Atlanta. “Not only do taxpayers lose, but so do citizens who count on programs like Medicare for their healthcare needs.”

“It is unacceptable for hospitals to provide financial incentives to induce physicians to steer patients their way, said Derrick L. Jackson, Special Agent in Charge at the U.S. Department of Health and Human Services, Office of Inspector General in Atlanta.  “The OIG will vigorously pursue providers who enter into arrangements that can potentially corrupt medical decision making.”

In early 2016, the U.S. Attorney’s Office for the Northern District of Georgia initiated a civil health care fraud investigation into UGH after receiving information from law enforcement agents who arrested several UGH employees for alleged criminal misconduct regarding controlled substances.  Shortly after these arrests, UGH replaced the majority of its executive team, conducted an internal investigation, and voluntarily disclosed significant amounts of information related to several financial relationships with physicians and physician practices. 

This settlement resolves allegations that UGH engaged in several different improper financial relationships with physicians between 2012 and 2016, in violation of the Stark Law. The Stark Law forbids hospitals from billing Medicare for certain services referred by physicians who have a financial relationship with the hospital unless the relationship falls within a defined exception. The United States alleges that the relationships UGH had with certain physicians were prohibited because UGH compensated the physicians in amounts that were above or inconsistent with fair market value or in a manner that took into account the volume or value of the physicians’ referrals.

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 & Human Services Office of Inspector General, and the Federal Bureau of Investigation, with assistance from the Tactical Diversion Squad from the Drug Enforcement Administration.

The civil settlement was reached by Assistant U.S. Attorneys Lena Amanti and Gabriel Mendel.

For further information please contact the U.S. Attorney’s Public Affairs Office at or (404) 581-6016.  The Internet address for the home page for the U.S. Attorney’s Office for the Northern District of Georgia Atlanta Division is

Updated February 6, 2019

False Claims Act