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People’s lives depend on medical treatment and testing. These matters should be treated with the utmost care and propriety. Healthcare is also a big business however, and there are many individuals and companies looking to exploit the system for their own profit. The former head of a Texas hospital is now making a seven-figure payment to the U.S. government because he unlawfully steered certain tests to a specific provider. 

The Department of Justice (DOJ) alleged that Jeffrey Madison engaged in a scheme to induce physicians to refer tests to a particular laboratory. To achieve this, Madison allegedly offered and paid illegal remuneration, including cash payments, to physicians in exchange for their referrals. These alleged payments violated the Anti-Kickback Statute, a federal law that prohibits offering, paying, soliciting or receiving remuneration to induce referrals for healthcare services paid by federal healthcare programs, such as Medicare and Medicaid.

While unscrupulous individuals and others might claim that this sort of inducement is a “victimless crime,” because the lab tests had to be done someplace, there are several reasons why kickbacks harm patients and the medical profession, such as:

• Overutilization of healthcare services — Unnecessary tests, inappropriate medications and procedures that offer no medical benefit are frequently ordered to generate revenue, increasing healthcare costs for patients and taxpayers.

• Compromised patient care — Patients don’t receive optimal care when doctors are partly focused on their personal financial considerations.  

• Increased risk of fraud and abuse — Kickback schemes can create opportunities for other forms of fraud, such as billing for services not rendered or upcoding.

Healthcare providers must prioritize compliance with federal healthcare laws and regulations to avoid legal and financial risks. When someone inside a healthcare organization sees that decisions are not being made based on objective medical judgment, they have a duty to speak up. Hospitals and other healthcare facilities should encourage employees to report suspected fraud, waste and abuse through a confidential hotline or other mechanism.

If you suspect that medical professional is giving or receiving kickbacks, it’s time to contact an attorney from Kardell Law Group. Our firm has extensive experience successfully representing whistleblowers in cases involving healthcare fraud and other types of misconduct.