California Pulmonologist Shells Out Over $200K to Settle Kickback Charges

Case: The former CEO of a California hospital filed a whistleblower suit accusing the hospital and at least two of its affiliates of hiring a pulmonologist at above fair market compensation to serve as medical director in exchange for patient referrals in violation of the Anti-Kickback Statute and Stark Law. Rather than risk a trial, the medical director agreed to pay $215,288 to settle the charges, $42,529 of which will go to the whistleblower. Significance: This is the recent in a long line of cases targeting providers for paying excessive compensation to medical directors in an illegal bid to buy referrals. The hospital defendants named in the original whistleblower lawsuit settled in 2018 at a hefty $8.1 million price tag. The government’s decision to intervene in the case likely exerted enormous pressure on the defendants to settle.