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Texas Heart Hospital to Pay $48M to Settle False Claims Allegations


Texas Heart Hospital of the Southwest in Plano, Texas, and its subsidiary have agreed to pay $48 million to resolve allegations accusing the Heart Hospital of violating the False Claims Act.

Per the complaint, the healthcare establishment knowingly submitted claims to the Medicare program, violating the Anti-Kickback Statute and the Physician Self-Referral Law.

The Anti-Kickback Statute forbids paying or offering remuneration for generating service or item referrals that come under the coverage of Medicaid, Medicare, or any other federally funded programs.

The Physician Self-Referral Law, also called the Stark Law, bars a hospital from billing for particular services under the Medicare program unless that relationship suffices one of the regulatory or statutory exceptions of the law.

The Anti-Kickback Statute and the Stark Law help in preventing medical misjudgments caused by unethical financial dealings.

The prosecutors said that the hospital breached the Anti-Kickback Statute and Stark Law by establishing a requisite for its physician owners to generate a 48-patient-contact obligation to maintain hospital ownership.

Two physician owners, Todd Dewey, MD, and Mitchell Magee, MD, divulged the allegations under the qui tam clause of the False Claims Act. Dr. Magee and Dr. Dewe will acquire $13.9 million as their recovery share.

Jeffrey Bossert Clark, the Acting Assistant Attorney General of the Department of Justice’s Civil Division, said, “Inappropriate financial relationships between health care providers and their referral sources can distort physician decision-making and drive up health care costs for everybody.” He added, “The department remains committed to ensuring that physicians act in the best interests of their patients rather than their pocketbooks.”

The United States Attorney for the Eastern District of Texas, Stephen J. Cox, said, “Although the business of healthcare continues to evolve, our mission remains the same—to ensure that medical decision making is based on patient care and free of influence by financial consideration.”

He further added, “We commend the whistleblowers and their counsel for uncovering this arrangement and pursuing the case to a point where Defendants and the United States were able to reach a resolution that both protects the taxpayer and ensures patient care, free from financial influence.”

The Department of Health and Human Services Office of the Inspector General and the Justice Department’s Civil Division, the U.S. Attorney’s Office for the Eastern District of Texas, processed the matter on behalf of the government.