The Cincinnati-based, not-for-profit health system self-disclosed the allegations after an internal audit found that payments to six employed physicians exceeded fair market value for the services provided.
DOJ said Cincinnati-based Mercy provided compensation to six employed physicians—one oncologist and five internal medicine physicians—that exceeded the fair market value of their services.
"During an internal audit, Mercy Health learned that it made errors in the administration of a small number of physician arrangements," the health system told HealthLeaders Media in a statement Friday. "Mercy Health promptly disclosed the administrative errors to the federal government, with which it cooperated fully, and is pleased to have resolved the matter."
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"When physicians are rewarded financially for referring patients to hospitals or other healthcare providers, it can affect their medical judgment, resulting in overutilization of services and higher health care costs," said acting Assistant Attorney Chad A. Readler, head of the Justice Department’s Civil Division.
"In addition to yielding a recovery for taxpayers, this settlement should deter similar conduct in the future and help make health care more affordable," Readler said.
"Hospitals should employ their physicians at a compensation level that is consistent with fair market value for the area of practice, and should not attempt to incentivize physicians to refer patients based on anything other than the best clinical interests of the patient," said First Assistant United States Attorney Vipal Patel for the Southern District of Ohio.
John Commins is a content specialist and online news editor for HealthLeaders, a Simplify Compliance brand.