On December 1, 2017, it was announced that Pine Creek Medical Center LLC had agreed to pay $7.5 million to resolve claims that it violated the False Claims Act. The physician-owned hospital was accused of paying kickbacks to physicians in the form of marketing services in exchange for surgical referrals. The government alleged that between 2009 and 2014, Pine Creek Medical Center LLC engaged in an illegal kickback scheme in which the hospital paid for marketing and advertising services on behalf of physicians.
In return, the physicians referred patients, including beneficiaries of Medicare and TRICARE, to Pine Creek. The hospital was accused of paying for advertisements in local and regional publications. It also allegedly paid for radio, television, billboard, and pay-per-click advertising. In accordance to the settlement, Pine Creek agreed to enter into a corporate integrity agreement with the Department of Health and Human Services Office of Inspector General.
The hospital will be required to undertake numerous internal compliance reforms for the next five years. The settlement resolves allegations brought forward by a whistleblower’s lawsuit. As a result, whistleblowers, Savannah Sogar and Suzanne Scott, will receive $1,125,000 of the settlement. Additional details are available here.