Cooper Health System in Camden, N.J., has agreed to pay $12.6 million to settle whistle-blower allegations that it inappropriately encouraged cardiologists to refer patients to its hospitals by paying them $18,000 a year to serve on a local advisory board.
The system, which operates 493 beds among two hospitals, agreed to pay the Justice Department $10.2 million and the state of New Jersey $2.3 million for alleged violations of the state and federal false claims acts, which prohibit hospitals from paying doctors to refer patients to their facilities for treatment.
Whistle-blower Dr. Nicholas DePace, who filed the case after he was recruited to serve on the advisory board, will receive $2.4 million from the proceeds of the settlement, the settlement agreement says (PDF).