The U.S. Justice Department on Tuesday announced a settlement with a Midlands-based family practice over millions in improperly-billed services.
Family Medicine Centers of South Carolina LLC will pay $1.56 million under the settlement, while its principal owner and former CEO Stephen Serbin and its former Laboratory Director Victoria Serbin have also agreed to pay $443,000.
Federal prosecutors accuse Serbin of violating the Stark Act by directing staff to submit Medicare claims that violated the ban on physicians self-referring patients for Medicare dollars. The Stark Law prevents a clinic from billing Medicare for certain services ordered by docters who have a financial relationship with the provider they recommend. In this case, the Justice Department claimed FMC’s incentive compensation plan paid doctors a percentage of the value of lab and other diagnostic tests they ordered through the clinic. FMC then billed those lab tests to Medicare.
The Department of Health and Human Services special agent-in-charge said the incentives program “amounts to thinly-veiled bribes.”
“Healthcare decisions should be made by physicians based on medical science and not with regard to maximizing the doctor’s own income,” U.S. Attorney Beth Drake said in a statement. “Our goal in bringing this case was not only to recover money for improper healthcare claims, but also to deter similar conduct and promote health care affordability.”
FMC operates a half-dozen family medicine clinics throughout the Columbia and Lexington regions.
The Justice Department brought similar Stark Act charges against the Tuomey Hospital in Sumter, eventually winning a $237 million judgment against the hospital in 2013. In that case, the government claimed the Sumter hospital entered into a deal with 19 physicians who agreed to refer patients to the hospital for outpatient services in exchange for reimbursements well above the free markey value. Tuomey was purchased by Columbia-based Palmetto Health a few years later.