Corporate Compliance

St. Joseph Medical Center to pay $22M to settle federal charges

Compliance Monitor, November 17, 2010

St. Joseph Medical Center (SJMC) agreed to pay $22 million to settle allegations that the hospital paid illegal kickbacks to a cardiology group intended to induce referrals to the hospital, according to a Department of Justice (DOJ) press release.

According to the DOJ, SJMC made 11 professional services agreements with MidAtlantic Cardiovascular Associates (MACVA), under which MACVA received payments above fair market value for services not rendered or that were not commercially reasonable. The two parties allegedly entered the agreements for the purpose of inducing referrals. Between January 1, 1996, and January 1, 2006, MACVA made referrals to SJMC for cardiovascular procedures, including cardiac surgery and interventional cardiology procedures.

The settlement also resolves allegations that the hospital received payment from federal healthcare programs for medically unnecessary stents performed by Mark Midei, MD, a former partner in MACVA and employee of SJMC.

Stephen D. Lincoln, MD, Peter Horneffer, MD, and Garth McDonald, MD, cardiac surgeons who practiced as members of Cardiac Surgery Associates in Baltimore, filed the case under the qui tam provision of the False Claims Act. They will receive a portion of the settlement.

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