UPDATE: Georgia Hospital Settles Amid Allegations of Unlawful Kickbacks in Exchange for Obstetric Referrals

In 2014, we covered the government’s decision to intervene in a False Claims Act lawsuit involving several Central Georgia-area hospitals and possible Medicaid fraud. As a bit of review, the case involved several hospitals, including Tenet Healthcare, Health Management Associates, and Clinica de la Mama, an OB/GYN facility geared toward undocumented and migrant Hispanic women.

Presently, the Department of Justice has announced a partial settlement of the issues at hand between the Department of Health and Human Services, Health Management Associates, and Clearview Regional Medical Center. The settlement amounts to just over $595,000, and the False Claims Act cases against the other hospitals and healthcare management companies remain outstanding.

The case was originally brought to light in 2009 by a whistleblower familiar with the operations of the hospital companies. According to the details of the Department of Justice’s press release,[1. http://www.justice.gov/opa/pr/united-states-settles-kickback-allegations-georgia-hospital] the relator will receive $109,000 in exchange for his willingness to come forward with the unlawful and discriminatory billing practices, which are outlined below in further detail.

Details of the settlement agreement with Georgia area hospitals

While not the largest healthcare fraud settlement on the books, the alleged facts of the circumstances involving Georgia’s Health Management Associates (HMA) and Clearview Regional Medical Center present an alarming case at the intersection of patient discrimination and rampant fraudulent billing practices.

According to these allegations, HMA and CRMC offered lucrative kickbacks and financial incentives to doctors practicing at the OB/GYN facilities located in the immediate vicinity which treated largely undocumented migrant women. More specifically, the respondents are believed to have offered a certain fixed sum of money to obstetricians who referred their pregnant patients to CRMC for labor and delivery. In most instances, the costs associated with these labors and deliveries were covered by Medicaid, thereby triggering the False Claims Act and exposing the entire scheme for what it was: discrimination and fraud. By engaging in this sort of scheme, pregnant women were unable to make an informed choice as to the best hospital and medical team to attend the birth of their children, and this sort of “taint” on patient consent is precisely the sort of misconduct targeted by the anti-kickback portions of the False Claims Act.

Government’s reaction

Understandably, government officials did not take kindly to this kind of arrangement, and the U.S. Attorney’s Office commented, “The Medicaid program is a vital part of the government’s efforts to make sure that everyone has access to health care….Instead of providing health care services to expectant mothers in its area and receiving payment for those services from Medicaid, the hospital participated in a scheme to pay kickbacks in exchange for having pregnant women from outside its market funneled to its facility with the goal of increasing the amount of Medicaid money the hospital could claim.”

Contact Berger Montague today

If you are aware of similar healthcare fraud involving Medicaid patients, please do not hesitate to contact Berger Montague right away to discuss your information.