Allegedly Paid Stipends And Gifts To Referring Physicians
Extravagant Dinners, Expensive Gifts And Golf Trips
Former Accounting Department Employee Blew Whistle
The Anti-Kickback Statute, 42 U.S.C. § 1320a-7b (prohibits kickbacks for medical services referrals), and the Stark Law, 42 U.S.C. § 1395nn (prohibits physicians from referring patients to providers that the physician has a financial interest in) are federal laws designed to ensure doctors make medical decisions with only their patients’ best interests in mind. The statutes prohibit kickbacks or lucrative referral programs which create monetary incentives that may be opposed to a patient’s best interest. When the kickback relates to a medical service or product paid for by the government (under Medicare or Medicaid, for example) the federal payment is fraudulent because the kickback/referral statutes have been violated. Private citizens can bring civil lawsuits on behalf of the government for redress against such fraud under the False Claims Act, (“FCA”), 31 U.S.C. § 3729 et seq. If you have credible information of fraud against the government in violation of the FCA, Anti-Kickback Statute or Stark Law in San Francisco or elsewhere in California, call us today at (415)441-8669 and we can help. Our toll-free number is 1-888-50EVANS (888-503-8267).
Recent False Claims Act/Anti-Kickback Statute Case Settlement
In a recent press release by the U.S. Department of Justice (DOJ), a skilled nursing facility and its management company have agreed to pay the United States and California a total of $3.825 million to resolve allegations that they submitted and caused the submission of false claims to Medicare and Medicaid by paying kickbacks to physicians to induce patient referrals.
The Anti‑Kickback Statute prohibits offering or paying remuneration to induce the referral of items or services covered by Medicare, Medicaid, and other federally funded programs. It is intended to ensure that medical decision-making is not compromised by improper financial incentives and is instead based on the best interests of the patient.
The government alleges that from 2009 through 2019, defendants gave certain physicians extravagant gifts, including expensive dinners for the physicians and their spouses, golf trips, limousine rides, massages, e-reader tablets, and gift cards worth up to $1,000. Separately, defendants allegedly paid these physicians monthly stipends of $2,500 to $4,000, purportedly for their services as medical directors. At least one purpose of these gifts and payments was to induce these physicians to refer patients to the defendants’ care facilities, according to the government.
“Kickbacks can impair the independence of physician decision-making and waste taxpayer dollars,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “The department is committed to preventing illegal financial relationships that undermine the integrity of our public healthcare programs.”
“Paying illegal remuneration to induce patient referrals undermines the integrity of our nation’s health care system,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “To ensure that the goods and services received by federal health care program patients are determined by their health care needs, rather than the financial interests of third parties, we will pursue any individual or entity that violates the prohibition on paying kickbacks, including DME manufacturers.”
How A Qui Tam Action Begins
A former accounting department employee (referred to as the “relator”) initiated the case just described. Any False Claims Act whistleblower case begins by a relator filing a complaint under seal in the federal court usually for the District in which the defendant is located or does business. At the same time, the relator submits a disclosure to the DOJ outlining the material evidence the relator has of the alleged false claims. 31 U.S.C. § 3730(b). The seal period of the complaint lasts 60 days during which the DOJ investigates the claims. 31 U.S.C. § 3730(b)(2). (If necessary, the government can, and often does, extend the 60-day period during which the allegations are kept under seal.) If the government decides to intervene in the case, the government essentially takes over the litigation. 31 U.S.C. § 3730(c)(1). If the government declines to intervene, the relator may proceed with the litigation on his or her own. 31 U.S.C. § 3730(c)(3).
If you have credible information of government fraud in San Francisco or elsewhere in California, call Ingrid M. Evans at (415) 441-8669, or toll-free at 1-888-50EVANS (888-503-8267) or by email at <a href=”mailto:firstname.lastname@example.org”>email@example.com</a>. In addition to FCA and CFCA whistleblower cases, Ingrid and Evans Law Firm, Inc. also handle bank fraud whistleblower cases under FIRREA/FIAFEA, commodity trading and securities fraud under the Commodities Futures Trading Commission Whistleblower Program and the Securities and Exchange Commission Whistleblower Program, and tax fraud under the Internal Revenue Service Whistleblower Program.
 Evans Law Firm, Inc. was not involved in the case in any way.