Dive Brief:
- The North Broward Hospital District in Florida will pay the government a record $69.5 million to settle allegations it violated the Stark law by illegally paying nine physicians for referrals. The Stark law prohibits physician compensation that creates a financial conflict of interest.
- A Florida orthopedic surgeon, Dr. Michael Reilly, filed a lawsuit against Broward Health in 2010, stating the organization had offered to employ him under terms that violated the Stark law.
- North Broward maintained they did no wrongdoing as part of the settlement, which is the largest ever reached without litigation under the Stark law, Bryan Vroon, an Atlanta attorney for Dr. Reilly told Modern Healthcare.
Dive Insight:
Several Stark cases have been brought to court under the False Claims Act, which, according to Modern Healthcare, can result in triple damages if a provider is found liable. A federal appeals court earlier this year upheld a $237 million verdict against Tuomey Healthcare System in South Carolina in a Stark case, and Florida's Halifax Health agreed to settle a Stark/False Claims case last year for $85 million despite not admitting to fraud.
CMS is working to reduce the complexity of the Stark law via proposed regulatory changes. Whistleblowers in false claims cases receive a portion of the money the government acquires. Dr. Reilly will receive $12 million.