Alabama-based Lab Pays $24.5 million penalty in kickback scheme

From our friends at

“Alabama-based Infirmary Health System (IHS), Infirmary Medical Clinics (IMC), Diagnostic Physicians Group P.C. (DPG) and two clinics run by IMC have agreed to pay $24.5 million to settle allegations they violated the Stark Law and Anti-Kickback Statute by engaging in a scheme to compensate physicians for laboratory and radiology referrals… The government alleged IHS, through its subsidiaries and clinics, paid physician-owned DPG ‘a percentage of collections on items and services performed or referred by DPG physicians’ to IHS-affiliated clinics that performed clinical laboratory and diagnostic imaging tests from 2005 to 2011. DPG then compensated individual physicians for their referrals.”

Read more here.

Note from Jeffrey C Lynne:

Cases such as this are, for the time being, prosecuted based upon the fact that Medicare and/or Medicaid was implicated, as the Stark Laws only pertain to these federal health insurance programs. The Federal Anti-Kickback Statute (AKS) is more broad. However, to date, we are not aware whether the federal government, or any state government, has sought prosecution against a provider who only seeks reimbursement from private pay insurance.

About Jeffrey Lynne

Jeffrey C. Lynne is a South Florida native, representing individuals and business entities relating to licensing, accreditation, regulatory compliance, business structure, marketing, real estate, zoning and litigation pertaining to substance abuse treatment facilities and sober living residences. Mr. Lynne has been recognized across the region as a leader in progressive public dialogue about the role that substance abuse treatment has within our communities and the fundamental need and right to provide safe and affordable housing for those who are both in treatment for addiction and alcoholism as well as those who are established in their recovery.