The Health Alliance of Greater Cincinnati and one of its former member hospitals, the Christ Hospital, have agreed to pay $108 million to the U.S. government to settle claims that they violated the Anti-Kickback Statute and the False Claims Act by paying unlawful remuneration to doctors in exchange for referring cardiac patients to the Christ Hospital in a pay-to-play scheme, the Department of Justice (DoJ) has reported.

The DoJ alleged that the Christ Hospital, a 555-bed acute-care hospital located in Mount Auburn, Ohio, limited the opportunity to work at the Heart Station—an outpatient cardiology testing unit that provides non-invasive heart procedures—to those cardiologists who referred cardiac business to the Christ Hospital. The DoJ further alleged that cardiologists whose referrals contributed at least 2 percent of the hospital’s yearly gross revenues were rewarded with a corresponding percentage of time at the Heart Station, where they had the opportunity to generate additional income by billing for the patients they treated at the unit and for any follow-up procedures that these patients required.

The DoJ asserted that the Christ Hospital’s use of Heart Station panel time to induce cardiac referrals violated the federal Anti-Kickback Statute, which prohibits a hospital from offering or paying, or a physician from soliciting or receiving, anything of value in return for patient referrals. The DoJ also alleged that the claims the Christ Hospital submitted to Medicare and Medicaid as a result of this illegal kickback scheme constituted a violation of the False Claims Act.

"Healthcare providers should make medical decisions based on the needs of their patients, not on the financial interests of physicians or other providers," said Tony West, assistant attorney general for the civil division of the DoJ. "We will not allow hospitals to put profits ahead of sound medical decision-making."

The allegations resolved by today’s settlement were initiated by a whistleblower lawsuit filed under the qui tam provisions of the False Claims Act, which allow private parties to file actions on behalf of the U.S. and share in any recovery. The whistleblower in this suit, Harry Fry, MD, a cardiologist who formerly worked at the Christ Hospital, will receive $23.5 million.

Because the Christ Hospital declined to enter into a corporate integrity agreement acceptable to the Office of Inspector General (OIG), the OIG did not provide a release of its administrative exclusion authorities and is further evaluating the matter.