California-based Tulare health agencies settle illegal kickback charges

Tulare Local Healthcare District, Tulare District Healthcare System and Tulare District Hospital, located in central California, have reached a settlement with the U.S. Government to resolve charges that the healthcare providers had engaged in a ssam to make illegal kickbacks to doctors who referred their patients to Tulare. The settlement includes a substantial cash payment to reimburse the government for claims made to Medicare that violated the False Claims Act. The fraudulent conduct came to light when Maria Lucy Reimche, Tulare’s former chief financial officer, filed a whistleblower lawsuit alleging that from 2001 through 2007, in exchange for referring patients to Tulare, doctors were able to lease or purchase commercial property at below-market rates and to have their debts forgiven. By making claims to Medicare for services provided to patients referred by the physicians who had been illegally compensated, the lawsuit charged that Tulare violated three federal statutes: the False Claims Act; the Anti-Kickback Statute; and an anti-referral statute known as “the Stark law.”

The False Claims Act is a general anti-fraud statute that prohibits government contractors from making false claims for payment to the federal government, and allows whistleblowers who confront such fraud by filing suit to share in any recovery. The Anti-Kickback Statute makes it illegal to offer or receive anything of value as a means to attract patients who receive medical services that are paid for by a federal health care program. The Stark law generally prohibits hospitals from billing the government for certain Medicare-covered health services given to patients referred by doctors who have a financial relationship with the hospital.

For the full story, go to Central Valley Business Times.

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