West Penn Allegheny to pay government $1.53 million to resolve false claims

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The West Penn Allegheny Health System has agreed to pay the federal government $1.53 million to settle False Claims Act allegations related to below-market leases that the health system offered to independent physician practices.

The health system self-reported the lease arrangements to the U.S. Attorney’s office, which -- based on that information -- accused WPAHS of using the discounted leases as a means to encourage the physicians to refer patients to its facilities.

According to a release from U.S. Attorney David Hickton’s office Wednesday, the lease agreements violated the Anti-Kickback Statute and the Stark Law.

The Anti-Kickback Statute prohibits “offering, paying, soliciting or receiving remuneration to induce referral of items or services covered by Medicare, Medicaid and other federally funded programs,” while the Stark Law forbids hospitals from billing those programs for certain services provided by physicians who have a financial relationship with the hospital.

The U.S. Attorney’s Office said the leases also “resulted in improper claims being submitted to federal health care programs.”

WPAHS did not admit liability in the settlement agreement.

Most of the leases in question were negotiated between 2008 and 2012. WPAHS officials alerted the Office of the Inspector General about them in December 2012. West Penn Allegheny was acquired by insurer Highmark in 2013 as the centerpiece of its Allegheny Health Network health system.

WPAHS spokesman Dan Laurent said in a statement Wednesday that the settlement agreement "resulted from a self-audit and voluntary reporting to the Office of the Inspector General,” adding that, “Our actions leading to the settlement reflect how seriously we take our compliance responsibilities and the diligence with which we monitor and fulfill those obligations.”

Steve Twedt: stwedt@post-gazette.com or 412-263-1963.

First Published March 19, 2014 11:30 AM

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