tci Medicare Compliance & Reimbursement - 2009 Issue 20

COMPLIANCE TRENDS: Covenant Case Holds Stark Reminders for Hospitals, Physicians

Don't rely overly on the employment exception -- or discount a competitor's ability to stir up trouble. Covenant Medical Center in Waterloo, Iowa, recently agreed to fork over a hefty $4.5 million to settle a federal False Claims Act lawsuit involving alleged Stark law violations. The case provides a potential harbinger of things to come and some "lessons learned" for hospitals and physicians trying to survive a growing government crackdown on fraud and abuse.The crux: The U.S. government claimed that Covenant submitted false claims to Medicare because it had gravely overpaid five employed physicians who referred...

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