Earlier this month, the Department of Justice (“DOJ”) issued a press release announcing that healthcare system Community Health Network Inc. (“Community”) agreed to pay $345 million to resolve allegations that it had violated the False Claims Act by knowingly submitting claims to Medicare for services that were referred to it in violation of the Stark Law. In connection with the settlement, Community also entered into a five-year Corporate Integrity Agreement with the Department of Health and Human Services Office of Inspector General.
On December 2, 2021, the Department of Justice (“DOJ”) issued a press release announcing that Flower Mound Hospital Partners (“Flower Mound”), a partially physician-owned hospital, agreed to pay just over $18 million to resolve allegations that it had violated the False Claims Act by submitting claims that violated the Stark Law and the Anti-Kickback Statute. (more…)
This month the U.S. District Court for the Southern District of Indiana denied Community Health Network’s (“Community”) motion to dismiss the United States’ complaint-in-intervention alleging that Community submitted false claims based on underlying violations of the Stark Law. United States ex rel. Fischer v. Community Health Network, Inc., No. 14-cv-1215 (S.D. Ind.). The complaint alleged that Community violated the Stark Law through physician compensation that exceeds fair market value (“FMV”) and is based on the volume or value of referrals. The opinion is notable in concluding that even physician compensation at the 90th percentile of rates paid in the market can plausibly allege a financial relationship that is not FMV and thus violates the Stark Law.