On November 8, 2019, the Department of Justice (DOJ) announced a settlement with a New York hospital for $12.3 million in connection with alleged improper overlapping and concurrent urology surgeries performed by one physician. The settlement also addressed allegations relating to medically unnecessary operating room services as well as alleged Stark law violations involving the physician’s compensation arrangement.

Specifically, the Complaint alleges that from July 2013 through June 2018, the hospital allowed the physician to engage in inappropriate overlapping surgeries when they allowed him to schedule two separate surgeries at the same time, often an endoscopy and a high-risk complex surgery involving a robot. The Complaint further alleges that residents assisting the physician were not supervised in accordance with Medicare requirements and the hospital’s own supervision policy. The Complaint also alleges that the hospital permitted the physician to perform minor procedures in operating rooms, which resulted in the submission of claims for medically unnecessary operating room services. In addition, the Complaint includes allegations that the hospital submitted claims for services in violation of the Stark Law because the physician’s compensation grossly exceeded fair market value as it factored in the value of his referrals of designated health services to the hospital and included compensation for services he did not perform.

As part of the settlement, defendants admitted to certain conduct alleged in the Complaint, including that the hospital practices resulted in the submission of several million dollars of inappropriate claims to Medicare. The DOJ press release is available here.