Tenet Healthcare, Vanguard Health Systems, and the Detroit Medical Center (DMC) agreed to pay $29.7 million as part of a settlement with the Department of Justice (DOJ) addressing allegations they provided kickbacks to doctors who made referrals to their health organizations.
The details: The DOJ alleged two of DMC’s hospitals, Sinai Grace and Harper University, offered services of mid-level practitioners free of charge or at below-market levels to 13 physicians from January 2014 through December 2017. The free or discounted labor of the employees was given to the doctors in exchange for their referrals of Medicare patients, a violation of the Anti-Kickback Statute and the False Claims Act, the DOJ said in a press release Wednesday.
Tenet acquired Vanguard hospitals within the DMC network in 2013. Tenet is one of the largest health organizations in the United States.
The qui tam lawsuit was filed in the Eastern District of Michigan in 2015 by Jay Meythaler, a physician and former employee of Wayne State University Medical Center, which is affiliated with DMC. Meythaler will receive more than $5.2 million, the DOJ said.
“The Justice Department will pursue improper arrangements that have the potential to compromise physicians’ medical judgment,” Deputy Assistant Attorney General Michael Granston of the agency’s Civil Division said. “Physicians should evaluate where to send patients for medical services based on the quality of care the patients will receive, not the financial benefits that the physicians will reap.”
Company response: “DMC, Vanguard, and Tenet admitted no liability in settling the matter. Once we became aware of the allegations, Tenet and DMC fully cooperated with the government throughout its investigation,” DMC said in an emailed statement.
“The settled claims include allegations that DMC leased nurse practitioners or physician assistants to physicians without collecting full payment for those employees in order to induce these physicians to send their patients to DMC in violation of the Anti-Kickback Statute,” DMC said. “No new leases were executed once Tenet owned these facilities, and DMC denies there was any improper purpose to these arrangements.”