A settlement has been reached to resolve False Claims Act allegations against Avanti Hospitals LLC.
The allegations arose from a lawsuit that claimed Avanti Hospitals LLC (Avanti) and six of its owners submitted or caused Avanti’s subsidiary, Memorial Hospital of Gardena (Gardena Hospital), to submit false claims to the Medicare and Medicaid programs for medical services referred by a physician who received kickbacks and other improper payments from Gardena and other Avanti affiliates.
According to the government, allegedly, the payments from Avanti, Gardena Hospital and at least two other Avanti affiliates to a high-referring physician violated the Anti-Kickback Statute and the Physician Self-Referral Law. Reportedly, Avanti, Gardena Hospital and at least two other Avanti affiliates provided compensation to a physician they engaged as a medical director that (1) exceeded fair market value for his services, and (2) was an attempt to incentivize him to refer patients to Gardena Hospital.
“Illegal kickbacks paid to doctors for referrals burden our healthcare system, drive up insurance costs for everyone, and corrupt the doctor-patient relationship,” said United States Attorney Nick Hanna for the Central District of California. “Patients are not commodities who can be sold to the highest bidder, especially when the bills are ultimately being paid by American taxpayers.”
The whistleblower, Dr. Joshua Luke, the former C.E.O. of Gardena Hospital will receive approximately $1.6 million from the federal government.
