On May 28, the U.S. Department of Justice (DOJ) announced that Ashland Hospital Corp., the operator of King's Daughters Medical Center, has agreed to a $40.9 million settlement to settle allegations that the hospital billed Medicare and the Kentucky Medicaid program for medically unnecessary procedures and had illegal financial relationships with physicians who referred patients.
The government had alleged that the hospital billed the federal
programs millions of dollars for unnecessary coronary stents and
diagnostic catheterizations performed by its physicians on Medicare
and Medicaid patients between 2006 and 2011. The physicians
allegedly falsified patient records in order to justify the
procedures. The hospital was also alleged to have violated the Stark Law by paying some of its
cardiologists unreasonably high salaries that exceeded the fair
market value of their services.
In addition to the monetary penalty, the hospital agreed to enter
into a Corporate Integrity Agreement with the U.S. Department of
Health and Human Services' Office of Inspector General (OIG),
which will require it to improve compliance and have its Medicare
and Medicaid claims reviewed by a third party for five years. The
DOJ and OIG were assisted in the investigation by several other
federal agencies and the Kentucky Attorney General's
office.
Most of the settlement will be paid to the federal government.
Kentucky will receive about $1 million as the state's share of
the recovered Medicaid funds.
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