Catholic Health System will pay nearly $3.3 million to settle allegations of improper Medicare claims tied to physician referrals.
BUFFALO, N.Y. — Catholic Health System, Inc. (CHS) has agreed to pay nearly $3.3 million to resolve allegations that it violated the False Claims Act by submitting improper Medicare claims connected to physician referrals, the U.S. Attorney’s Office for the Western District of New York announced today.
According to U.S. Attorney Michael DiGiacomo, the case centers on alleged violations of the Physician Self-Referral Law—commonly known as the Stark Law—which generally prohibits healthcare providers from billing Medicare for certain services referred by physicians with whom they have improper financial relationships.
Federal investigators allege that CHS and its affiliated hospitals maintained compensation arrangements with non-employee physicians whose referrals led to Medicare claims for services such as lab testing, hospital care, and medical supplies. The government contends that these financial relationships did not meet legal exceptions under the Stark Law, stating that the compensation was either not commercially reasonable or exceeded fair market value for the administrative services performed.
The Stark Law is designed to protect Medicare by ensuring that physician referrals are not influenced by financial interest,” stated U.S. Attorney DiGiacomo. “This office is committed to holding health care providers accountable who engage in such...
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