Beaumont Health to pay $84.5M to resolve claims of improper physician relationships

Southfield, Mich.-based Beaumont Health has agreed to pay the federal government and state of Michigan $84.5 million to resolve allegations that three of its hospitals submitted false claims to Medicare, Medicaid and Tricare, according to the Justice Department.

The government alleged Beaumont Health hospitals in Royal Oak, Troy and Grosse Pointe, Mich., submitted false claims resulting from improper relationships with eight referring physicians. The government alleged that from 2004 to 2012, Beaumont Health hospitals made improper payments to the referring physicians that were "substantially in excess of fair market value."

The government further alleged the hospitals provided "free or below-fair market value office space and employees" to physicians in exchange for referrals of patients and then submitted false claims for care provided to the referred patients.

The settlement resolves these claims, as well as claims that Beaumont Health allegedly falsely represented a CT radiology center as an outpatient department in submitted claims to government payers, the Justice Department stated.

The allegations against Beaumont Health were initially brought in lawsuits filed under whistle-blower provisions of the False Claims Act by four former administrative and physician employees.

Beaumont Health said in a news release that the allegations came up and were corrected before Beaumont Health System in Royal Oak, Mich., Oakwood Healthcare in Dearborn, Mich., and Botsford Health Care in Farmington Hills, Mich., finalized their merger in 2014 and created the new Beaumont Health system.


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