A Dallas-Fort Worth physician group, Flower Mound Hospital Partners, LLC (“FMHP”), has agreed to pay $18.2 million to resolve allegations of False Claims Act violations in a civil settlement brought under qui tam provisions. The Department of Justice (“DOJ”) announced that FMHP was accused of knowingly submitting Medicare, Medicaid, and TRICARE claims resulting from referrals in violation of the Stark Law and the Anti-Kickback Statute between June 2019 and June 2021. The whistleblower in the case, Leslie Jennings, MD, was an FMHP physician-owner. Dr. Jennings filed the complaint in November 2019 and will receive $3 million of the settlement.
According to the DOJ, in 2019 FMHP, a joint venture partial owner of Texas Health Presbyterian Hospital – Flower Mound, redistributed 20% of its physician-owned shares based on the volume and value of patient referrals made to the hospital by the share-holding physicians. The settlement detailed that FMHP repurchased a percentage of shares from each physician-owner over 63 years old and then resold the shares to younger physicians, allegedly taking previous and future referrals into account. While FMHP’s buying and selling of physician-owned shares is not an issue in and of itself, the allegations of preferentially selling the shares as a reward to physicians who had track records of higher referral volumes, or as an incentive to make referrals down the road, were a problem.
Under the settlement agreement, FMHP will enter into a 5-year corporate integrity agreement (“CIA”) with the OIG-HHS under which the hospital will maintain a compliance program, secure compliance training and certifications for key executives, and hire an independent organization to review all financial arrangements.
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