Whistleblower Rewards for Physician Self-Referral Violations

Medicare and Medicaid have paid out millions of dollars to whistleblowers who have helped uncover violations of the Stark Law, which is also known as the physician self-referral statute.

The Stark law prohibits physicians from referring Medicare or Medicaid patients to other healthcare providers or entities with which the physician or an immediate family member has a financial relationship.

A financial relationship includes an ownership interest, a passive investment interest, and compensation arrangements.  For example, the Stark Law prohibits a physician from referring patients to an imaging center the physician has invested in, unless an exception applies.

The prohibition applies to a long list of "designated health services," including:

• clinical laboratory services;
• physical therapy, occupational therapy, and outpatient speech-language pathology services;
• radiology and other imaging services;
• radiation therapy services and supplies;
• durable medical equipment (DME) and supplies;
• parenteral and enteral nutrients, equipment, and supplies;
• prosthetics, orthotics, and prosthetic devices and supplies;
• home health services;
• outpatient prescription drugs; and
• inpatient and outpatient hospital services.

The Stark law is a strict liability statute.  This means that the government does not have to prove that the physician intended to violate the statute.  If the referral violated the Stark Law, then any claims submitted to Medicare or Medicaid are automatically considered “false claims.”

The penalties for Stark Law violations are severe.  The physician and the entity that received the referrals may be required to pay back up to three times the amount Medicare or Medicaid paid for the services, plus fines of up to $11,000 for each claim.  In addition, those involved may be excluded from Medicare and Medicaid programs, and they may face suspension or loss of their professional licenses.

Stark Law violations are often difficult for the government to discover.  That is why the government relies on whistleblowers to come forward with evidence.  In return, the government pays whistleblower rewards of between 15% and 30% of the amount the government recovers.  The rewards often amounts to hundreds of thousands of dollars, and sometimes millions of dollars.

If you have evidence that a physician or physician practice group is engaged in self-referrals that violate the Stark Law, then you should consult with a whistleblower attorney immediately.  You must comply with strict time limits and procedural requirements in order to qualify for a whistleblower reward.

To schedule a free and confidential consultation with an experienced whistleblower lawyer, call John Howley, Esq. at (212) 601-2728.