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Sibley Hospital, Johns Hopkins To Pay $5M In Stark Law Settlement

Analysis  |  By Amanda Schiavo  
   April 18, 2023

The Stark Law violations allegedly took place between 2008 and 2011.

Sibley Hospital and its parent company, Johns Hopkins Health System, will pay a $5 million settlement over allegations the organizations violated the Stark Law, which prohibits hospitals from billing Medicare for certain services referred by physicians with whom the hospital has a financial relationship unless that relationship satisfies one of the law’s statutory or regulatory exceptions.

It is alleged that from 2008 through 2011 Sibley Hospital violated the Stark Law by billing Medicare for services that were referred by 10 cardiologists to whom Sibley was paying compensation that exceeded the market value of the provided services, according to a Department of Justice statement. Sibley and Johns Hopkins disclosed the issue to the Justice Department themselves.

"Improper financial arrangements between hospitals and physicians can influence the type and amount of healthcare that is provided," Principal Deputy Assistant Attorney General Brian Boynton, head of the Justice Department’s Civil Division, said in the statement. "The department is committed to holding accountable those who violate prohibitions designed to protect the integrity of physician decision-making."

The Stark Law is designed to ensure that medical decisions are not made under the influence of improper financial incentives.

"Patients have the right to medical care that is strictly about their health and not about the financial benefit or obligation that a physician might receive or owe," U.S. Attorney Graves for the District of Columbia, said in the statement. "We welcome conversations with anyone who might have credible information that medical care is being undermined by outside influences. This office works in concert with many partners to protect the public, including the Fraud Section of the Department of Justice and the Office of Inspector General for the U.S. Department of Health, to ensure the rules are followed."

Amanda Schiavo is the Finance Editor for HealthLeaders.

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