Healthcare News & Insights

Excess doc pay leads to $4.5M settlement

An Iowa hospital has agreed to pay $4.5 million to settle charges about misusing Medicare funds to compensate certain doctors.

In the case, the feds claimed Covenant Medical Center of Waterloo paid five doctors for referring patients to the hospital for services. Some of the physicians were making more then $2 million a year — roughly double the expected compensation for their positions.

The feds claimed that the docs in question were paid far more than market value, which disqualified them from receiving Medicare funds and that the payments violated the Stark Law.

Covenant denies any wrong doing, claiming that the doctors were specialists working in understaffed specialties.

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  1. Steve Munie says:

    Why is our government in the business of determining who much someone is allowed to make in this country, especially when we have sports stars and entertainers making millions of dollars? The caption for this article initially made me think that someone was gaming the system. After reading the couple of sentences in this article I have a very different perspective.

    If the world’s foremost specialist were to offer up his (her) services to a poor community hospital and from their own sense of compasion and generosity accept the pitiful reimbursement that Medicare allows, it appears that would be a violation of Medicare payments.

    I’m sure there’s much more to this story that we do not know about but if Medicare regularly pays $27 for some procedure, how can they disqualify someone from taking that payment because they make too much? Are Medicare patients to be summarily exempt from treatment from the best doctors even if that doctor is willing to accept the Medicare payment and not go after the patient for the fair value of their services?

  2. Dear Steve, it is true that the Iowa story must have more to the story, as many do. But remember that providers whom choose to accept Medicare Assignment, have agreed to adhear and comply with the terms-which includes reimburstment fee schedules. It becomes an issue when providers want the best of both worlds-don’t we all, but we all must live within that relm. You comment on a $27 (some) procedure, but you don’t mention the other very high paying procedures, and yes there are some. I don’t want to sound like I’m favoring Medicare or ANY insurance reimburstment fee schedule-but please, don’t be as one-sided as the article that you disagree with.

    For the record, working (20 years) in the administrative side of the medicare field, I see both sides, everyday. But for ANY provider to manipulate the system, gets me going, and yes there are some. If providers really want to get their “fair market value” cancel your Medicare Assignment, as well as the other private contracts and simply render services on a cash basis-good luck.