MedStar Health to Pay $35M to Settle Alleged Violations of False Claims Act

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MedStar Health agreed to pay the United States government $35 million to settle allegations that it violated the False Claims Act and the Anti-Kickback Act.

MedStar Health allegedly paid kickbacks to MidAtlantic Cardiovascular Associates (MACVA) under the guise of professional services agreements. In exchange, it will receive referrals to Union Memorial and Franklin Square Hospitals for lucrative cardiovascular procedures. The non-profit health system allegedly paid kickbacks from January 1, 2006 to July 31, 2011.

Additionally, it allegedly received Medicare payments from January 1, 2006 until December 28, 2012 for medically unnecessary stents performed by Dr. John Wang.

Dr. Wang was a one-time employee of MACVA and was later employed by the non-profit health system.

Whistleblowers filed lawsuits against MedStar Health

Several whistleblowers including surgeons and former patients of Dr. Wang filed a complaint against MedStar Health for its illegal practices. They also included Union Memorial, Franklin Square and others in their complaints.

The whistleblowers brought their allegations under the quitam provisions of the False Claims Act. The law allows private citizens with knowledge of false claims to file lawsuits on behalf of the U.S. government and to share any recovery. The whistleblowers will receive a portion of the federal share of the recovery under the civil settlement.

In a statement, Assistant Attorney General Jody Hunt of Department of Justice, Civil Division, said, “Kickbacks made in connection with the provision of medical services undermine the integrity of our health care system. We will take action against medical service providers who through unlawful conduct put their own financial interests ahead of the best interests of patients.”

On the other hand, U.S. Attorney Robert Hur stated, “Kickbacks give doctors an incentive to pursue unnecessary treatments that are costly and sometimes even dangerous to patients. We will not tolerate medical care providers who put their patients at risk and waste taxpayers’ dollars in order to line their own pockets.”