Profit-based Prime Healthcare and two of its doctors have agreed to pay the federal government $ 37.5 million to settle return charges involving implantable medical devices and the purchase of a surgery center from the system. sanitary.
U liquidation agreement announced Monday is a joint resolution with the U.S. Department of Justice and the California Department of Justice. Focus on alleged violations of the federal False Claims Act and the California False Claims Act.
The establishment claims that Dr. Prem Reddy, founder and CEO of Prime, must pay nearly $ 1.8 million. Dr. Siva Arunasalam, an interventional cardiologist from California, must pay $ 2 million and Prime must pay $ 33.7 million. The United States will receive $ 35.5 million in revenue and California will receive $ 2 million. Prime and Reddy have paid $ 65 million to settle previous charges without connection to false claims and overbilling in 2018.
Prime, based in Ontario, Calif., Had allegedly paid the reimbursements when he overpaid to buy the Arunasalam practice and surgery center because the company wanted him to refer patients to his Desert Valley Hospital in Victorville, Calif. Justice departments say the purchase price, negotiated primarily by Reddy, exceeded fair market value and was not commercially reasonable.
Prime allegedly rewarded Arunasalam because of an employment agreement with the Heart of the Desert Vascular Institute based on the volume and value of his patients ’referrals to Victorville Hospital.
The government also said that between 2015 and 2017, both the vascular institute and Arunasalam used the billing number of Arunasalam to bill Medicare and Medicaid for services provided by Dr. George Ponce, despite their billing privileges. they had been revoked and knew it was so inappropriate.
Some Prime hospitals have allegedly billed Medicaid, the Federal Employee Health Benefits Program and the Department of Labor’s Office of Compensation Programs for false claims based on inflated bills for implantable medical hardware. .
“Offering illegal financial incentives to physicians in exchange for patient referrals undermines the integrity of our health care system by denying patients the independent and objective judgment of their healthcare professionals,” said Brian Boynton, assistant attorney general at the civil division of the DOJ in a statement. . “Today’s establishment demonstrates the department’s commitment to protecting federal health care programs from such violations, as well as other efforts to defraud these important programs.”
Prime and Reddy have signed a five-year corporate integrity agreement with the HHS Office of the Inspector General. The agreement requires Prime to maintain a compliance program and employ an independent review organization to review the agreements entered into by or on behalf of its subsidiaries or affiliates.
The settlement settled two lawsuits filed in a Los Angeles federal court. One was introduced by Martin Mansukhani, former chief executive. The second was presented by Marsha Arnold and Joseph Hill, who were former employees in the billing office at a Prime hospital in Redding, Calif.