Georgia hospital enters $5M settlement with feds to resolve false claims case

Union General Hospital in Blairsville, Ga., agreed to pay $5 million to resolve allegations that it violated the False Claims Act and Stark Law, according to the Department of Justice.

The U.S. Attorney's Office for the Northern District of Georgia launched a civil healthcare fraud investigation into Union General Hospital in 2016 after several of the hospital's employees were arrested for alleged criminal misconduct regarding controlled substances. The hospital replaced most of its executive team and began an internal investigation after the arrests. Hospital officials also disclosed information regarding physician pay to federal prosecutors.

The settlement resolves allegations that Union General Hospital violated Stark Law by having improper financial relationships with several physicians between 2012 and 2016. The government alleged the hospital compensated physicians in amounts that were above fair market value. The hospital also allegedly took into account the volume of some physicians' referrals when determining their compensation, according to the Justice Department.

"We are glad to have reached a settlement so we can continue to focus fully on what we do best: providing the highest level of healthcare for the families in Union County and the surrounding areas," Myron Turner, chairman of the board of Union General, said in a press release. "Our number one priority is quality care for our community."

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