- Tuomey Healthcare System has agreed to a settlement payment of $72.4 million for illegal compensation arrangements with doctors - less than a third of the $237 million a federal appeals court requested. The company also agreed to be sold to Palmetto Health, based in Columbia, South Carolina.
- A federal jury in 2013 found the company violated the False Claims Act by submitting tens of thousands of illegal Medicare claims and it rewarded doctors financially for referring patients in violation of the Stark law. A federal appeals court upheld the decision in July.
- Tuomey Healthcare System is a nonprofit, anchored by Tuomey Regional Medical Center, with 252 beds, according to the American Hospital Association. It is the only hospital in Sumter, South Carolina.
Dr. Michael Drakeford, who would not enter into a financial agreement with the hospital, originally filed the case in 2005. According to Healthcare Finance, Tuomey entered in contracts with 19 specialists that required they refer their outpatient procedures to Tuomey. In exchange, Tuomey paid the doctors much more than fair market value and included a percentage of the money received from Medicare for the referred procedures, as per the court records.
As in all successful False Claims Act cases, whistleblowers are entitled to a percentage of money the government recovers. According to Modern Healthcare, Dr. Drakeford will receive $18.1 million from the settlement.