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Alabama Hospital System and Physician Group Settle FCA Allegations

July 21, 2014

Thanks to a lawsuit brought by Dr. Christian Heesch, a physician formerly employed by Diagnostic Physicians Group P.C. (DPG), pursuant to the qui tam provisions of the False Claims Act, the group, along with Infirmary Health System Inc. (IHS) and two IHS-affiliated clinics, has agreed to settle for $24.5 million according to a DoJ press release.  Dr. Heesch alleged that two IHS-affiliated clinics paid DPG a percentage of Medicare payments for tests and procedures referred by DPG physicians.  He went on to allege that Infirmary Medical Clinics P.C. (IMC), an affiliate of IHS, purchased a clinic from DPG and agreed to pay a share of the clinic’s revenues to DPG.

“Financial arrangements that compensate physicians for referrals encourage physicians to make decisions based on financial gain rather than patients’ needs,” said Assistant Attorney General for the Civil Division Stuart Delery.  “The Department of Justice is committed to preventing illegal financial relationships that undermine the integrity of our public health  programs.”

To report Medicare fraud, please contact Frohsin & Barger.

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