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Iowa Hospital Pays $4.5M for Alleged False Claims

August 25, 2009

Covenant Medical Center in Waterloo, Iowa has agreed to pay the United States $4.5 million to resolve allegations that it violated the False Claims Act,” announced the DoJ today. According to the allegations, Covenant received referrals from the five highest paid hospital doctors in the country and, in turn, paid them commercially unreasonable salaries far above fair market value for their services in violation of the Stark law. Tony West, Assistant Attorney General for the Civil Division, stated,

“Health care providers must act in the best interests of their patients. The Justice Department will protect patients by pursuing hospitals that have improper financial relationships with physicians.”

To report Stark violations or healthcare fraud, contact Frohsin & Barger.

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