U.S. ex rel. Baklid-Kunz v. Halifax Hosp. Med. Ctr. (Summary)
FALSE CLAIMS ACT – STARK LAW
U.S. ex rel. Baklid-Kunz v. Halifax Hosp. Med. Ctr., No. 6:09-cv-1002-Orl-31TBS (M.D. Fla. Nov. 13, 2013)
The United States District Court for the Middle District of Florida granted in part and denied in part a motion for partial summary judgment filed by the federal government in a False Claims Act suit against a hospital.
The government alleged that the hospital entered into employment agreements with oncologists that violated the Stark Law. According to the government, the oncologists’ productivity bonuses violated the Stark Law because they were calculated by referencing the medical oncology program’s operating margin (or profit), which took into account services not personally performed by the oncologists. The government filed a motion for summary judgment seeking a determination that the hospital violated the Stark Law and False Claims Act by billing Medicare for services provided as a result of referrals from the oncologists. The court granted the motion with respect to the government’s Stark Law claims, finding that the productivity bonus did not meet the Stark Law’s bona fide employment exception, since it was not based on services personally performed by the oncologists (even though the productivity bonus the oncologists received was “divided up” based on services personally performed). The court also rejected the hospital’s claims that the oncologists were not “referring physicians” simply because they were identified as the attending or operating physician on Medicare forms for processing facility fees. According to the court, “to accept [the hospital’s] argument…one would have to assume that…both attending physicians and operating physicians are completely disconnected from any ‘request or establishment of a plan of care…which includes the provision of designated health services.’” However, the court did not grant the government’s motion for summary judgment with respect to the amount of damages, because, among other things, the hospital’s contention that one of the oncologists did not receive a bonus in the relevant time period and could not have violated the Stark Law.