Dallas-based Tenet Healthcare has agreed to pay approximately $514 million to resolve allegations the for-profit hospital operator paid illegal kickbacks for referrals.
Here are nine things to know about the allegations and the settlement.
1. Tenet disclosed in June 2015 that it was the subject of a criminal investigation by the Department of Justice.
2. The criminal investigation, which dates back to 2012, arose out of a civil lawsuit filed under the qui tam provision of the False Claims Act. The suit alleges four Tenet hospitals paid illegal kickbacks to clinics that referred undocumented pregnant patients to them for Medicaid-covered deliveries. Undocumented patients are not eligible for regular Medicaid coverage. However, they typically qualify for emergency medical assistance when they deliver their babies.
3. The criminal investigation centers on the relationship the four Tenet hospitals had with Hispanic Medical Management. The hospitals contracted with HMM for translation, marketing, management and Medicaid eligibility determination services.
4. In 2014, federal investigators filed criminal charges against two people involved in the kickback scheme, a former owner of HMM and a former employee of a Tenet hospital. On April 10, 2015, the DOJ informed Tenet that four of its hospitals had become targets of the criminal investigation.
5. On May 6, 2015, Tenet received a grand jury subpoena from the DOJ seeking additional documents regarding the hospitals involved in the investigation.
6. On Aug. 1, 2016, Tenet said it believed it had reached an agreement in principle with the government to resolve the criminal investigation and civil litigation for $514 million. On Monday, Tenet said the agreement had been finalized.
7. In addition to the $514 million settlement, Tenet will also pay $3 million in related fees and expenses. The company plans to make these payments in the fourth quarter.
8. Under the settlement, Tenet will execute a three-year non-prosecution agreement with the DOJ. As part of the agreement, a compliance monitor will oversee Tenet's compliance with the Anti-Kickback Statute and Stark Law.
9. According to the Department of Justice, two Tenet subsidiaries, Atlanta Medical Center Inc. and North Fulton Medical Center Inc. have agreed to plead guilty to conspiracy to pay healthcare kickbacks and defraud the U.S.
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Editor's Note: This story was updated Oct. 1 to include the names of the Tenet subsidiaries.