Dallas hospital pays $7.5M settlement in alleged kickback scheme

Dallas hospital pays $7.5M settlement in alleged kickback scheme
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A Dallas-based hospital has agreed to pay $7.5 million to settle allegations that it offered marketing services to doctors in exchange for surgical referrals. 

The Department of Justice alleged that Pine Creek Medical Center, a physician-owned hospital in Texas, engaged in an illegal kickback scheme between 2009 and 2014 in which the hospital paid for marketing and/or advertising services on a doctor's behalf, and in return, the doctors would refer their patients to Pine Creek. 

As part of the settlement, Pine Creek will also enter a corporate integrity agreement with the Department of Health and Human Services (HHS) Office of Inspector General and complete "substantial" internal compliance reforms in the next five years. 


The case was handled by the U.S. Attorney's Office for the Northern District of Texas and the Justice Department's Civil Division, with assistance from the FBI and HHS. 

“Health care providers that attempt to profit from illegal kickbacks will be held accountable,” said Principal Deputy Assistant Attorney General Chad Readler, head of the Justice Department’s Civil Division. 

“Improper financial incentives can distort medical decision making and drive up health care costs for federal health care programs and their beneficiaries.” 

Those referred to Pine Creek included Medicare beneficiaries, as well as those who have coverage through TRICARE, a government-managed health insurance for service members, retirees and their families.