Posted: May 1, 2013 7:35 PM by MTN News
BILLINGS - The U.S. Justice Department announced Wednesday that St. Vincent Healthcare in Billings and Holy Rosary Healthcare in Miles City have agreed to pay $3.95 million plus interest to resolve allegations that they violated the Stark Law and the False Claims Act.
The allegations include improperly providing incentive pay to physicians that made referrals to the hospitals.
The Stark Law forbids a hospital from billing Medicare for certain services referred by physicians who have a financial relationship with the hospital, unless that relationship falls within certain exceptions.
A prohibited financial relationship includes a hospital's agreement to compensate a physician in a manner that takes into account the volume of the physician's referrals or the revenue realized through those referrals.
According to the U.S. Justice Department the settlement resolves allegations that the hospitals paid several physicians incentive compensation that took into account the value or volume of their referrals by improperly including certain designated health services in the formula for calculating physician incentive compensation. These issues were disclosed by the hospitals to the government.
St. Vincent Healthcare and Holy Rosary Healthcare are part of the Sisters of Charity of Leavenworth Health System.
SCL Health System CEO Jason Barker released a statement Wednesday stating that in 2009 an internal compliance review was conducted and they found some discrepancies in a few of their physician contracting arrangements.
At that point, Barker states that SCL Health System engaged outside experts to conduct a review and provide recommendations for improvements.
"We are committed to compliance with all healthcare laws and dedicated to avoiding future mistakes related to physician contracting," Barker said in the release. "We have enhanced our focus on compliance efforts by allocating more resources towards our compliance goals and implementing tighter contracting processes."
According to a statement provided to us by the Department of Justice, "The resolution of this matter underscores our commitment to ensure that services reimbursable by federal health care programs are based on the best interests of patients rather than the personal financial interests of referring physicians," said Stuart F. Delery, Acting Assistant Attorney General for the Department's Civil Division.
U.S. Attorney for the District of Montana Michael Cotter also provided a statement Wednesday.
"Combating health care fraud is a top priority of the Department of Justice and the Montana U.S. Attorney's Office. St. Vincent Healthcare and Holy Rosary Healthcare allegedly put their financial interest ahead of their responsibility to provide cost effective health care. The United States recovered $3,950,000 of taxpayers' dollars from the hospitals. The U.S. Attorney's Office is committed to enforcing the Stark Law and False Claims Act, as well as other health care laws and regulations against wrongdoers. This case also demonstrates how the Department of Justice will work with those health care providers who disclose their misconduct," said Cotter.
"There is an expectation that corporations providing services to Medicare and Medicaid beneficiaries adhere to the provision of the Stark Law. I applaud St. Vincent Healthcare and Holy Rosary Healthcare for recognizing their potential liability in this matter and making a disclosure," said Gerry Roy, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services region including Montana. "Working closely with our partners at the Department of Justice, we will vigilantly protect federal health care programs against violations of the Stark Law."
DOJ reports the claims settled by this agreement are allegations only, and there has been no determination of liability.