CFO: Montana hospital engaged in billing fraud, kickback scheme

Kalispell (Mont.) Regional Healthcare disclosed in June that it is under federal investigation, and a recently unsealed complaint filed by the CFO of the hospital's physician network provides more details about the allegations, according to the Flathead Beacon.

The 91-page federal complaint filed by Kalispell Regional Healthcare Physician Network CFO Jon Mohatt alleges the hospital engaged in a kickback scheme to boost revenues. The recently unsealed complaint specifically alleges the hospital provided improper compensation to several physicians based on referrals.

"At least since 2011, Kalispell Regional has engaged in a scheme to pay excessive compensation to certain employed physicians to reward or induce them to refer patients, including Medicare patients, to Kalispell Regional hospitals and clinics," states the complaint.

Mr. Mohatt originally filed the lawsuit in 2016 under the qui tam, or whistle-blower, provisions of the False Claims Act. The lawsuit was unsealed after the Department of Justice decided not to intervene in the case.

In June, Kalispell Regional officials said the system was required to set aside $21.5 million for a potential settlement of the lawsuit. In a memo to staff, officials denied any wrongdoing.

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