Oklahoma Orthopedic Hospital And Codefendants Agree To Pay $72.3 Million To Resolve Medicare Fraud Claims

An Oklahoma orthopedic hospital and several related individuals and entities have agreed to pay the Federal and state governments $72.3 million to settle claims that it defrauded Medicare, Medicaid, and TRICARE while violating the False Claims Act by allegedly paying illicit kickbacks.

Federal investigators say the defendants were engaged in a multi-layered conspiracy for several years. From 2006 through 2018, the hospital defendants allegedly gave its physician group and two individual physicians cheap or free office space, above-market compensation for services, preferential access to investment opportunities with the company, and other valuable consideration in exchange for referrals of patients to the hospital.

Prosecutors say this placed the defendants in violation of the Physician Self-Referral Law (a/k/a, “the Stark Law”), which prohibits hospitals from billing Medicare for certain services brought to the hospital by doctors with an improper financial arrangement. In addition, they allege the defendants violated the Anti-Kickback Statute, which makes illegal the paying of kickbacks for referrals for services to be reimbursed by Medicare, Medicaid, and other government healthcare programs.

In exchange for dropping charges, the defendants have agreed to pay the Federal and state governments a total of $72.3 million, divided up in different amounts among the defendants. The hospital and its management firm have also agreed to entering into a five-year Corporate Integrity Agreements (CIAs) administered by the U.S. Department of Health and Human Services – Office of Inspector General (HHS-OIG).

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