Tenet Healthcare, Vanguard Health Systems, and Detroit Medical Center (DMC) have reached a combined $29.7 million settlement with the U.S. government for allegedly providing kickbacks to certain referring physicians in violation of the False Claims Act (FCA), the Department of Justice announced.
DMC operates hospitals in and around Detroit, including Sinai Grace Hospital and Harper University Hospital. In October 2013, Tenet acquired Vanguard owned-and-operated hospitals and outpatient facilities, including DMC.
According to the allegations, in a settlement announced May 31, Tenet, Vanguard, and DMC “caused the submission of false or fraudulent claims to Medicare.” Specifically, the government alleged, from 2014 through 2017, “Sinai Grace Hospital and Harper University Hospital provided the services of DMC-employed mid-level practitioners to 13 physicians at no cost or below fair market value in violation of the Anti-Kickback Statute (AKS).”
The physicians allegedly “were selected because of their large number of patient referrals to Sinai Grace Hospital and Harper University Hospital, and that the purpose of these arrangements was to induce the physicians to refer additional Medicare patients to DMC facilities,” the DoJ stated.
The allegations were brought forth by Jay Meythaler, a former employee of Wayne State University Medical School, an affiliate of DMC. Under the FCA’s whistleblower provisions, a private party may file an action on behalf of the United States and receive a portion of any recovery. In this case, Meythaler will receive $5.2 million for his portion of the settlement. 
Jaclyn Jaeger is a contributing editor at Compliance Chief 360° and a freelance business writer based in Manchester, New Hampshire.