Healthcare News & Insights

Government intervenes in kickback lawsuit against Tenet and HMA

The gauntlet has been thrown down now that the government has intervened in a False Claims Act lawsuit against Tenet Healthcare Corp. and Health Management Associates, Inc. (HMA). 

100795300The lawsuit alleges that Tenet and four of its hospitals, and a hospital owned by HMA, paid kickbacks to Hispanic Medical Management d/b/a Clinica de la Mama and related entities that primarily served undocumented Hispanic women. In return, the facilities got patient referrals for labor and delivery at their hospitals.

They then billed Medicaid for the services, and in some cases, also got additional Medicare reimbursement based on the influx of low-income patients.

The Anti-Kickback Statute prohibits offering, paying, soliciting or receiving remuneration to induce referrals of items or services covered by Medicare, Medicaid and other federally funded programs. The Anti-Kickback Statute is intended to ensure that a physician’s medical judgment is not compromised by improper financial incentives and is instead based on the best interests of the patient.

“The Department of Justice is committed to ensuring that healthcare providers who pay kickbacks in return for patient referrals are held accountable,” said Stuart Delery, assistant attorney general for the Justice Department’s Civil Division, in a press release.  “Schemes such as this one corrupt the healthcare system and take advantage of vulnerable patients.”

Whistleblower case

The lawsuit was filed under the qui tam — whistleblower — provisions of the False Claims Act. This type of lawsuit permits private parties to sue on behalf of the government when they believe someone has submitted false claims for government funds. They are very popular, because the whistleblower receives a share of any money recovered in the lawsuit.

The False Claims Act also permits the government to intervene in such lawsuits, as it has done in this case against Tenet and HMA — two of the largest owner/operators of U.S. hospitals.  (Note: HMA was acquired by Community Health Systems last month.)

The lawsuit alleges that four Tenet hospitals (Atlanta Medical Center, North Fulton Regional Hospital, Spalding Regional Hospital and Hilton Head Hospital in South Carolina) and one HMA facility (Walton Regional Medical Center, since renamed Clearview Regional Medical Center), disguised kickbacks payments as a variety of services allegedly provided by Clinica.

“My office has made the investigation of healthcare fraud a priority,” said Michael Moore, U.S. attorney for the Middle District of Georgia. “In a time when too many people were struggling to get health care for themselves and their children, Tenet and these hospitals plundered a system set up for those truly in need. This kind of scheme drives up costs for everyone, not just the vulnerable patients and groups like those targeted in this case.”

We will keep you posted on the case.

 

 

 

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