The DOJ said in a news release Methodist paid $7,250,000 to resolve allegations it violated the False Claims Act.
MEMPHIS, Tenn. — Memphis' Methodist Le Bonheur Healthcare has settled a federal lawsuit over its partnership with the West Clinic.
The lawsuit, which began in 2017, accused the healthcare system of paying West Clinic for patient referrals.
Methodist said in a news release that the settlement amount is less than 3% of the original amount sought, and is “roughly equivalent” to what Methodist would have spent to continue litigation. The DOJ said in a news release Methodist paid $7,250,000 to resolve allegations it violated the False Claims Act.
“Methodist continues to dispute the allegations, but recognized this litigation is a drain on resources that are best used to provide the highest quality and safest care to our patients, as the region’s only Leapfrog Grade-A health system,” said its own statement.
The U.S. Department of Justice's Attorney's Office claimed payments Methodist made to West Clinic for unlawful patient referrals were disguised as a management partnership from December 2011 to February 2019. The DOJ claimed Methodist continued the illegal partnership even after a whistleblowers’ lawsuit was filed on May 30, 2017 by Jeffrey H. Liebman, who is the former President of Methodist University Hospital.
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