The U.S. Attorney for the Middle District of Florida pursued a nursing home for an allegedly sham Medical Director arrangement with a local orthopedic physician. The nursing facility and physician are to pay 1.5 million back to the government as part of a settlement agreement. It was alleged that the purpose of the agreement was to induce the physician to refer patients to the facility for rehabilitation services:
The settlements announced today resolve allegations that Conway Lakes, through File, Cleveland, Fraser, and Clear Choice, conspired to pay Dr. Krumins under a sham “medical director” agreement to induce him to illegally refer Medicare and TRICARE patients to Conway Lakes for rehabilitation services that were billed to the United States. Dr. Krumins’s settlement agreement also resolves allegations that he engaged in a similar kickback scheme with a related home health agency.
Facilities should take care that such agreements are drafted with care and do not give the appearance of a kickback arrangement:
“Disguising intricate kickback arrangements through directorships and other misrepresented positions corrupts physician decision making and undermines the public’s trust in the healthcare system,” said Special Agent in Charge Shimon R. Richmond of the U.S. Department of Health and Human Services’ Office of Inspector General (HHS-OIG). “Our agency will continue to investigate health care providers that seek to illegally boost profits at the expense of federal health care programs.”