Missouri hospital and clinic to pay $34M to settle false claims suit

A Missouri hospital, clinic and infusion center have agreed to pay $34 million to settle a federal lawsuit that alleged they defrauded Medicare.

The suit alleged that Mercy Hospital Springfield and its affiliate, Mercy Clinic Springfield Communities, had an improper financial agreement that provided kickbacks to oncologists based on the value of their chemotherapy referrals to the infusion center.

“When physicians are rewarded financially for referring patients to hospitals or other health care providers, it can affect their medical judgment, resulting in over-utilization of services that drives up health care costs for everyone,” said Chad Readler, the acting assistant attorney general for the U.S. Department of Justice’s Civil Division.

The $34 million settlement is almost 10 percent of the total ($360 million) that the Justice Department recovered from all hospitals and outpatient clinics under the False Claims Act last year.

Under the act, the whistleblower who filed the federal suit against his employers, Dr. Viran Roger Holden, will receive $5.44 million of the settlement.

This story was originally published May 23, 2017 at 3:21 PM with the headline "Missouri hospital and clinic to pay $34M to settle false claims suit."