Georgia's Columbus Regional Healthcare System will pay the government up to $35 million to settle lawsuits accusing it of violating a federal law governing physician self-referrals and billing the government for higher levels of services than those actually provided.
The government and a whistle-blower had alleged that Columbus doled out excessive salary and directorship payments to Dr. Andrew Pippas in violation of the Stark law. That law prohibits physicians from referring Medicare and Medicaid patients to entities, for certain services, with which they have financial relationships.
The government and whistle-blower also alleged that from 2006 to 2013, Columbus billed federal healthcare programs for higher levels of services than supported by documentation. They also accuse Columbus of billing the government for radiation therapy at higher levels than the therapy that was actually provided between 2010 and 2012.
Columbus will pay the government $25 million, plus up to an additional $10 million in contingent payments. Pippas agreed to pay $425,000.
The settlement did not include any admission of liability.
“The parties agreed to settle in order to avoid continued costly and protracted litigation,” Columbus said in a news release. “None of the allegations of either lawsuit involve the quality of patient care or services delivered at John B. Amos Cancer Center.”
Pippas is the center's medical director. He said in the release, “Now that we have these matters behind us, I am looking forward with renewed energy to continuing to advance and improve the cancer care we deliver at the John B. Amos Cancer Center.”
Columbus noted that it has put a “significant amount of work” into its corporate compliance program in recent years and will continue to “engage in a thorough review process to ensure accurate billing and coding and proper compensation in physician relationships.”
Columbus added, “It is common for there to be differences of opinion about coding and billing as well as proper physician compensation arrangements, as is evident by the large number of recent lawsuits and settlements in the healthcare industry over these issues.”
The Stark law has been widely criticized for its complexity. As in the Columbus situation, many Stark allegations have, in recent years, been brought to court under the False Claims Act, which can mean triple damages.
The CMS recently released proposed regulatory changes that experts say seem aimed at easing the technical burdens of the law and reducing the numbers of self-disclosures coming to the CMS.
Columbus had operating revenue of $411.6 million in 2014, according to the Modern Healthcare financial database.
The lawsuits were originally filed by Richard Barker, a former Columbus Regional executive. Under the False Claims Act, whistle-blowers are entitled to a portion of whatever money the government is able to recover. The amount of money Barker will receive had not yet been determined Friday, according to the U.S. Justice Department.