Department of Justice intervenes in Stark Law case against Indiana company

by Ben Vernia | January 28th, 2020

On January 7, the Department of Justice announced that it had filed a complaint in intervention in a whistleblower’s qui tam lawsuit against Community Health Network, alleging that the Indiana health provider violated the Stark Law. According to DOJ’s press release:

The United States has filed a complaint against Community Health Network Inc. (Community) in the U.S. District Court for the Southern District of Indiana, the Department of Justice announced today.  Community, an integrated health care system in central Indiana, is alleged to have violated the Stark Law and thereby submitted false claims to the Medicare program.  

The Stark Law prohibits a hospital from billing Medicare for services referred by a physician with whom the hospital has an improper financial relationship that does not meet any statutory or regulatory exception.  The government’s complaint alleges that Community had employment relationships with a number of physicians that did not meet any Stark Law exception because the compensation Community paid to the physicians was well above fair market value and because Community conditioned paying bonuses on physicians achieving a minimum target of referral revenues to the hospital.  The complaint alleges that Community received referrals from these physicians in violation of the Stark Law and submitted claims to Medicare knowing that the claims for those referred services were not eligible for payment. 

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