Mercy Health settles Stark Act allegations for $14.25 million

by Ben Vernia | May 11th, 2018

On May 10, the Department of Justice announced that Cincinnati-based Mercy Health had agreed to settle the company’s self-disclosed allegations that its hospitals had violated the Stark Act, which forbids certain financial arrangements between referring healthcare providers. According to DOJ’s press release:

Mercy Health, a nonprofit organization based in Cincinnati that operates healthcare facilities in Ohio and Kentucky, has agreed to pay the United States $14,250,000 to settle allegations that it violated the False Claims Act by engaging in improper financial relationships with referring physicians, the Justice Department announced today.

The settlement announced today resolved allegations that Mercy Health provided compensation to six employed physicians – one oncologist and five internal medicine physicians – that exceeded the fair market value of their services.  Federal law restricts the financial relationships that hospitals may have with doctors who refer patients to them.  These issues were self-disclosed to the government by Mercy Health.

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