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HealthSouth and Physicians Pay $14.9 Million to Settle Health Care Fraud Claims
Date:12/14/2007

Settlement Resolves Investigation of Physician Kickbacks

WASHINGTON, Dec. 14 /PRNewswire-USNewswire/ --- HealthSouth Corporation and two physicians have agreed to pay the United States a total of $14.9 million to settle allegations that the Birmingham, Ala.-based company submitted false claims to the government and paid illegal kickbacks to physicians who referred patients for care in some of its hospitals, outpatient rehabilitation clinics, and ambulatory surgery centers, the Justice Department announced today.

HealthSouth will pay $14.2 million, and the physicians will pay a total of $700,000 under separate settlement agreements. HealthSouth, currently the nation's largest provider of inpatient rehabilitation services, was also one of the largest providers of outpatient rehabilitation services, ambulatory surgery services, and diagnostic imaging services until it sold those lines of business earlier this year.

Today's settlement results from disclosures made by HealthSouth in 2004 and 2005 to the U.S. Attorney for the Northern District of Alabama, Alice Martin, and the Department of Health and Human Services' Office of Inspector General, after a change in management and an internal investigation. The government's investigation was jointly handled by the U.S. Attorney's Office for the Northern District of Alabama, the U.S. Attorney's Office for the Central District of California, the Civil Division of the Department of Justice, the Department of Health and Human Services, Office of Inspector General, and the FBI.

The settlement resolves claims made by HealthSouth to Medicare and Medicaid for services provided to patients referred by orthopedic surgeons Drs. James Andrews and Lawrence Lemak of Birmingham, when HealthSouth had financial relationships with the physicians, their former partnership, the Alabama Sports Medicine and Orthopaedic Clinic, and their research and training foundation, the American Sports Medicine Insti
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SOURCE U.S. Department of Justice
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