A lawsuit is underway in Illinois over an alleged scheme involving MRI-related illegal kickbacks to doctors involving 20 radiology centers in the Chicago area.
The allegation is that the radiology centers were part of sham agreements through which the doctors would pay a reduced rate for MRI and CT scans but charge the patient’s insurance a heftier rate, and pocket the remaining amount, according to a statement from Illinois attorney general's office.
The alleged scheme involved doing the MRI scans at the radiology centers, but the financial arrangement gave the illusion that the doctors owned the equipment and could then bill the services as if they had performed them.
“Illinois has a clear policy against kickbacks, and making payments to doctors for referral of patients is illegal, no matter how those payments are disguised,” said Illinois Atty. Gen. Lisa Madigan, in a statement. “Our investigation revealed evidence showing that this practice occurs among doctors and radiology centers in Illinois. This is an illegal practice that must stop.”
According to the lawsuit, the defendants’ actions were in violation of the Consumer Fraud and Deceptive Business Practices Act, as well as the state’s anti-kickback law. The suit requests that the court make the defendants stop the illegal kickbacks and seeks money damages, restitution and penalties, according to the attorney general’s statement.
The Chicago Tribune reports that the fraud could come to a price tag for insurers and consumers in the millions of dollars. And under Illinois law, penalties for such fraud can rise as high as $10,000 for each claim sent to an insurance company.
The complaint names MIDI, LLC, a company based out of Virginia that runs thirteen Open Advanced MRI facilities in Illinois, in addition to several other Chicago area radiology centers.
The suit only names 11 companies operating MRI centers, though the attorney general’s office has revealed its belief that the fraudulent activity could involve facilities throughout the country.
"The physicians provide no services, but merely refer the patients," the lawsuit states. "Each participating MRI service center involved performs the subject MRI services and then engages in the making of illegal and unlawful kickbacks to the physician from payments made by both Illinois citizen patients and their insurers," the Tribune reports.
Madigan office has taken over the civil prosecution of the case which seeks an undisclosed amount of restitution, damages and penalties, the Tribune reports.