by Ben Vernia | December 5th, 2023
On December 4, the Department of Justice announced that four physicians and a former hospital administrator have agreed to pay collectively over $880,000 to settle allegations that the physicians received kickbacks for referring laboratory services. According to DOJ’s press release:
Former hospital executive Peggy Borgfeld, of Lexington, Texas, and physicians Linh Nguyen, M.D. and Thuy Nguyen, M.D., of Dallas, and Heriberto Salinas, M.D., of Cleburne, Texas, have agreed to pay a total of $880,199 to resolve False Claims Act allegations involving illegal remuneration in violation of the Anti-Kickback Statute. The parties also have agreed to cooperate with the Justice Department’s investigations of, and litigation against, other participants in the alleged schemes.
* * *
The Anti-Kickback Statute prohibits offering, paying, soliciting or receiving remuneration to induce referrals of items or services covered by Medicare, Medicaid, and other federally funded healthcare programs. The Anti-Kickback Statute is intended to ensure that medical providers’ judgments are not compromised by improper financial incentives and are instead based on the best interests of their patients.
The settlements announced today resolve allegations that Drs. Linh Nguyen, Thuy Nguyen and Heriberto Salinas received kickbacks in violation of the Anti-Kickback Statute in return for their laboratory testing referrals.
* Linh Nguyen and Thuy Nguyen. Drs. Linh Nguyen and Thuy Nguyen have agreed to pay $404,813 to resolve two allegations from October 2015 to February 2018. First, the physicians allegedly received thousands of dollars in payments from a purported management service organization (MSO) named Ascend MSO of TX LLC (Ascend) in return for ordering laboratory tests from Little River Healthcare (Little River), a critical access hospital in Rockdale, Texas, and Boston Heart Diagnostics Corporation (Boston Heart), a clinical laboratory in Framingham, Massachusetts. Second, the physicians allegedly received thousands of dollars in payments from an MSO named Geminorium MG LLC in return for ordering laboratory tests from True Health Diagnostics LLC, a clinical laboratory in Frisco, Texas.
* Heriberto Salinas. Dr. Salinas agreed to pay $150,386 to resolve two allegations from December 2015 to May 2017. First, Dr. Salinas allegedly received thousands of dollars in MSO payments from Ascend in return for ordering laboratory tests from Little River. Second, Dr. Salinas allegedly received thousands of dollars in payments from a purported MSO named Herculis MG LLC in return for ordering laboratory tests from Boston Heart.
* * *
In addition, the United States announced that Peggy Borgfeld, the former controller, chief financial officer and chief operating officer of Little River, agreed to pay $325,000 plus additional contingent payments to resolve allegations that she caused the submission of false claims to Medicare, Medicaid and TRICARE. Borgfeld allegedly knew that Little River paid commissions to recruiters who used MSOs to pay kickbacks to doctors to induce their laboratory testing referrals to Little River. The settlement resolves allegations that Borgfeld knowingly caused Little River to submit claims to federal healthcare providers for the laboratory tests that the kickback recipients referred to Little River. The settlement also resolves allegations that, despite her knowledge of the MSO kickbacks, Borgfeld signed false certifications in Medicare cost reports regarding Little River’s compliance with the Anti-Kickback Statute. Under the terms of the settlement agreement, Borgfeld agreed to be excluded from participation in federal healthcare programs for five years.
* * *
The case apparently arose from a government investigation, and not from a whistleblower’s qui tam complaint.
