Northside Hospital, Atlanta, will pay $5.72 million to settle civil whistle-blower charges that it provided free employees to two physician-owned companies with which it did business and took other illegal steps to benefit the companies and their owners. The 487-bed hospital didnt admit wrongdoing. The physician-owned companies will pay $650,000 to settle related charges. According to government documents, Northside operated a blood-cancer treatment program with the Blood and Marrow Transplants Group, which was owned by three physicians. Two of the physicians also owned Atlanta Blood Services, which provided blood products to the program. The False Claims Act lawsuit was filed by the transplant groups former chief executive officer and by a former billing and office manager for the company. Northside allegedly provided free employees to the companies; purchased platelets and other blood products at inflated prices; and paid the doctors for medical directorships at rates far exceeding fair-market value.
The government alleged the illegal conduct began in 1997 and continued through 2004. At deadline, Northside officials didnt respond to calls seeking comment. Attempts to reach an attorney representing the physician companies were unsuccessful. The defendants will pay a total of more than $400,000 in attorneys fees. The whistle-blowers will split $1.2 million of the settlement, said their attorney, Marlon Wilbanks of Harmon, Smith, Bridges & Wilbank. -- by Mark Taylor