Whistle-blower physician: 'We have got to get hospitals out of the business of hiring doctors'

Fort Lauderdale, Fla.-based Broward Health, formerly North Broward Hospital District, agreed to pay $69.5 million last month to settle allegations brought by Michael Reilly, MD, and the Department of Justice in a federal lawsuit. Dr. Reilly claimed the system violated the False Claims Act by engaging in improper financial relationships with physicians. Although Dr. Reilly's action was against Broward Health, he claims health systems across the country have the same problems.

Dr. Reilly told Kaiser Health News the issue begins with the growing trend of hospitals employing physicians.

"We have to get hospitals out of the business of hiring doctors," Dr. Reilly told Kaiser Health News. "It's potentially detrimental to the patient, and it's terrible for healthcare."

Dr. Reilly was offered an employment deal with Broward Health, but he rejected the offer after his lawyer told him it was illegal. In his lawsuit, which was originally filed in 2010 and unsealed last month, Dr. Reilly claims the system carefully tracked the value of physician referrals and pressured physicians to increase referral volume when they lagged.

In addition to fostering an environment to motivate physician referrals, the employment trend "blunts physician innovation, discovery and ingenuity," Dr. Reilly said.

The Broward Health settlement is just one of more than a dozen Stark Law cases the DOJ has settled in the last two years. Just a week after Broward Health settled with the DOJ, Altamonte Springs, Fla.-based Adventist Health System agreed to pay $118.7 million to the federal government and to the states of Florida, North Carolina, Tennessee and Texas to settle allegations it violated the False Claims Act and Stark Law by maintaining improper compensation arrangements with referring physicians.

More articles on healthcare industry lawsuits:

ACLU hits Trinity Health with lawsuit alleging EMTALA violations
Ex-Erlanger executive gets $600k in wrongful termination settlement
Nevada agrees to pay $400k to settle patient dumping allegations

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