Hospital Pays $108 Million for Cardiac Department's Anti-Kickback Violation

May 24, 2010 – The U.S. Justice Department settled a pay-to-play scheme at The Christ Hospital last week for $108 million. The hospital only allowed access to its Heart Station outpatient cardiology testing and noninvasive heart procedure unit to cardiologists who referred cardiac business to the hospital. The case alleged the The Health Alliance of Greater Cincinnati and one of its former member hospitals, The Christ Hospital, violated the antikickback statute and the False Claims Act, by paying unlawful remuneration to doctors in exchange for referring cardiac patients to The Christ Hospital. The government further alleged that cardiologists whose referrals contributed at least two percent of the hospital's yearly gross revenues were rewarded with a corresponding percentage of time at the Heart Station, where they had the opportunity to generate additional income by billing for the patients they treated at the unit and for any follow-up procedures these patients required. The government said The Christ Hospital's use of its Heart Station panel time to induce lucrative cardiac referrals violated federal antikickback law, which prohibits a hospital from offering or paying, or a physician from soliciting or receiving, anything of value in return for patient referrals. The United States also alleged that the claims The Christ Hospital submitted to Medicare and Medicaid as a result of this kickback scheme constituted a violation of the False Claims Act. “The Christ Hospital continues to disagree with the government’s allegations that the assignment of physicians to our cardiac testing station resulted in the inducement of local cardiologists to refer patients to the hospital,” said Susan Croushore, president and CEO of The Christ Hospital. “We decided to contribute to the joint settlement agreement with the Health Alliance of Greater Cincinnati instead of risking a potential catastrophic judgment that could jeopardize our ability to provide service to this community. This settlement allows The Christ Hospital to avoid the risk of the in excess of a billion dollar award that was sought by the government.” "Health care providers should make medical decisions based on the needs of their patients, not on the financial interests of physicians or other providers," said Tony West, assistant attorney general for the civil division of the Department of Justice. "We will not allow hospitals to put profits ahead of sound medical decision-making." The allegations resolved by today's settlement were initiated by a whistleblower lawsuit filed under the qui tam provisions of the False Claims Act, which allow private parties to file actions on behalf of the United States and share in any recovery. The whistleblower in this suit, Harry Fry, M.D., a cardiologist who formerly worked at The Christ Hospital, will receive $23.5 million. “Kickbacks can distort clinical decisions, cause over utilization, increase costs and threaten the quality of care provided to beneficiaries,” said Daniel R. Levinson, inspector general of the U.S. Department of Health and Human Services Office of Inspector General (OIG). The OIG, and its law enforcement partners, are committed to protecting the integrity of our federal health care programs and the health and welfare of the beneficiaries of those programs." Because The Christ Hospital declined to enter into a Corporate Integrity Agreement acceptable to the OIG, the OIG did not provide a release of its administrative exclusion authorities and is further evaluating the matter. “We ask that the community join us in moving forward from this disheartening case,” Croushore said. “We are glad to be rid of the costly litigation siphoning resources from our mission and the threat of a potential catastrophic judgment. By choosing the less risky course of action, The Christ Hospital can put this case behind us.” For more information: www.thechristhospital.com