The government has announced that a South Florida hospital district will pay $69.5 million to settle False Claims Act allegations related to financial arrangements with physicians.
This case follows the trend of increased scrutiny of physician compensation, both by whistleblowers and by regulators: a trend that may escalate in light of the government’s fraud alert urging physicians to ensure that their arrangements reflect fair-market value and the affirmation of a $237 million judgment against a hospital.
Through the settlement, the North Broward Hospital District in Broward County, Florida, resolved a qui tam lawsuit filed in the U.S. District Court for the Southern District of Florida. The physician who brought the case claimed that the hospital district paid employed physicians above market value of their services. According to the United States, these arrangements violated the False Claims Act and the Stark Law’s restrictions on a hospital’s compensation to referring physicians.
The case is United States ex rel. Reilly v. North Broward Hospital District, S.D. Fla., No. 0:10-cv-60590, announced as settled on September 15.