October 5, 2017

Houston-Area Hospitals Settle FCA Allegations for over $8M

By the C|C Whistleblower Lawyer Team

Four hospitals in the Houston area have agreed to pay $8.6M to settle allegations that they received kickbacks from ambulance companies in exchange for the hospitals’ Medicare and Medicaid transport referrals. The hospitals are Bayshore Medical Center, Clear Lake Regional Medical Center, West Houston Medical Center, and East Houston Regional Medical Center. All four hospitals are affiliated with Hospital Corporation of America (HCA).

This settlement is the Southern District of Texas’ second resolved matter that focused on wrongdoing on healthcare facilities’ parts in relationships with ambulance companies. The first one resolved in a $3.1M settlement in 2015 and focused on a Skilled Nursing Facility receiving kickbacks from various ambulance companies in exchange for Medicare and Medicaid referrals. Prior to these two actions, almost all cases focused on the actions of the ambulance companies rather than those of the medical facilities.

The Anti-Kickback Statute prohibits paying, soliciting, or receiving remuneration in exchange for referrals for services covered by federal healthcare programs, like Medicare and Medicaid. Violations of the law are actionable under the False Claims Act, which allows private parties to bring forward information about fraud on the government, and receive a monetary reward for that information.

The government learned of the fraud through two whistleblower-initiated lawsuit under the qui tam provisions of the False Claims Act. The whistleblowers will receive a to-be-determined portion of the settlement.

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