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WEIRTON -- Weirton Medical Center has agreed to pay $1.5 million to resolve allegations the hospital violated the False Claims Act by knowingly submitting or causing the submission of claims to Medicare in violation of the Physician Self-Referral Law.
According to information released Thursday by U.S. Attorney William Ihlenfeld's office, the settlement follows a voluntary self-disclosure made by the hospital regarding potential violations of the self-referral law, also known as the Stark Law.
According to a statement from WMC, the alleged violations occurred between March 1, 2012 and May 30, 2019, during the tenure of the hospital's previous management firm. The same firm also previously managed Wheeling Hospital, which, in September 2020, agreed to a $50 million settlement over similar allegations.
"Following the United States government's lawsuit against Wheeling Hospital, WMC terminated the contract with its management consultant and conducted an independent internal investigation to address any related concerns. WMC voluntarily cooperated with the U.S. Department of Justice in its investigation and we greatly appreciate the DOJ's efforts in resolving this matter," stated John Frankovitch, WMC president and CEO.
The hospital's statement notes WMC also reached a settlement with the West Virginia Attorney General's Office on any potential state claims.
According to Ihlenfeld's office, the Stark Law prohibits a hospital from billing Medicare for certain services referred by physicians with whom the hospital has a financial relationship, unless that relationship satisfies one of the law's statutory or regulatory exceptions.
The Stark Law is intended to ensure that medical decision-making is not compromised by improper financial incentives and is instead based on the best interests of the patient. The settlement resolves Weirton Medical Center's liability under the False Claims Act for submitting claims to Medicare that resulted from violations of the Stark Law due to payment of compensation to referring physicians that allegedly exceeded fair market value or took into account the volume or value of the physicians' referrals to the hospital.
"Improper compensation arrangements between hospitals and physicians will not be tolerated," said Ihlenfeld. "The U.S. Attorney's Office will be aggressive in its pursuit of those who violate the Stark Law and we strongly encourage whistleblowers to come forward."
The settlement is based on the hospital's financial condition, according to Ihlenfeld's office.
"Health care decisions should be based on patients' medical needs, not physicians' financial interests," said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Department of Justice's Civil Division. "The department will continue to investigate financial relationships that may improperly influence physician decision-making."
The matter was investigated by Senior Trial Counsel Diana Cieslak and Assistant U.S. Attorneys Stephanie Savino and Christopher Prezioso for the Northern District of West Virginia.
The resolution obtained in this matter was the result of a coordinated effort between the U.S. Justice Department's Civil Division, Commercial Litigation Branch, Fraud Section and the U.S. Attorney's Office for the Northern District of West Virginia with assistance from HHS-OIG.