(Editor’s note: This article, by Claire Osborn, ran in the Friday, October 4, 2024 Metro & State section of the Austin American- Statesman.—K.W.C.)
Former hospital chief executive officer Jeffrey Madison of Georgetown has agreed to pay $5.3 million to settle allegations in a federal lawsuit involving illegal payments to physicians for laboratory referrals, officials said.
Madison was CEO of Little River Healthcare, which operated a hospital in Rockdale in Milam County, when he filed false claims on behalf of the hospital to be submitted for laboratory testing to Medicare, Medicaid and Tricare, said a news release from the U.S. Department of Justice.
“Madison a l legedly agreed to a kickback scheme in which Little River paid commissions to recruiters who used purported management service organizations to pay kickbacks to doctors to induce their laboratory testing referrals to Little River,” the release said.
“The settlement resolves allegations that Madison knowingly signed, and caused others to sign, false certifications in Medicare cost reports regarding Little River’s compliance with the Anti-Kickback Statute, and thereby caused the submission of false claims to federal health care programs.”
The Anti-Kickback Statute prohibits offering, paying, soliciting or receiving remuneration to induce referrals of items or services covered by Medicare, Medicaid and other federally funded health care programs, the release said.
“Kickbacks to physicians from laboratories or other healthcare providers can undermine healthcare decision-making, subject patients to unnecessary medical services and waste taxpayer funds.” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division.
The set t lement a lso resolved allegations in the same lawsuit that Little River Healthcare paid Dr. Doyce Cartrett Jr. of Silsbee $2,000 per month in kickbacks disguised as medical director fees from February 2015 to May 2017 to get Cartrett to shift his laboratory testing referrals to Little River, according to the release.
It said under the terms of the settlement agreement, Madison is excluded from participating in federal health care programs for 25 years.
Madison also agreed to cooperate with the Justice Department’s investigations of, and litigation against, other participants in the alleged schemes, the release said. Little River Healthcare closed its hospitals in Bastrop, Cameron, Georgetown, Rockdale, Salado and Temple in 2018.
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