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Cardiologist and His Practice Settle DOJ Kickback Suit

— March 30, 2021

DOJ settles case with Beaumont doctor who allegedly billed for tests that never happened.

Cardiologist Dinesh Shah, MD, has paid the government $2 million to settle charges that he billed federal healthcare programs for diagnostic tests, usually involving the ankle-brachial index and the toe-brachial index, which both measure blood flow from the heart to extremities, in order to receive kickback fees.  The charges also focused on unnecessary nuclear stress tests.  According to the Department of Justice (DOJ), these tests were never actually performed.

Prosecutors alleged that from 2006 to 2017, Shah and his practice, Michigan Physicians Group, billed Medicare, Medicaid, and Tricare for tests “without regard to whether they were medically necessary” in order to receive kickback incentives.

“Subjecting patients to unnecessary testing in order to fill one’s pockets with taxpayer funds will not be tolerated,” said Acting U.S. Attorney Saima Mohsin. “Such practices are particularly concerning because overuse of some tests can be harmful to patients.”

Cardiologist and His Practice Settle DOJ Kickback Suit
Photo by Oles kanebckuu from Pexels

The settlement is part of a 2018 resolution in which William Beaumont Hospital, Royal Oak, paid $84.5 million to resolve allegations that it had improper relationships with eight referring physicians.  These actions led to the submission of false claims to Medicare, Medicaid, and Tricare from 2004 to 2012.

“Offering financial incentives to physicians in return for patient referrals undermines the integrity of our health care system,” said Acting Assistant Attorney General Chad A. Readler of the DOJ’s Civil Division, at the time.  “Patients deserve the unfettered, independent judgment of their health care professionals.”

“Health care providers that offer or accept financial incentives in exchange for patient referrals undermine both the financial integrity of federal health care programs and the public’s trust in medical institutions,” said Health and Human Services Office of Inspector General (HHS-OIG) Special Agent in Charge Lamont Pugh.  “Our agency will continue to protect both patients and taxpayers by holding those who engage in fraudulent kickback schemes accountable.”

The Anti-Kickback Statute prohibits “offering, paying, soliciting, or receiving remuneration to induce referrals of items or services” covered by Medicare, Medicaid, and other programs.

Prosecutors said that Beaumont offered these physicians compensation far above fair market value in order to secure patient referrals as well as allegedly provided free or inexpensive office space.  Four whistleblower lawsuits were eventually filed.  More than 21 physicians in total were named.

The lead whistleblower is a well-known neuroscientist, Dr. David Felten, who claimed his were ignored for years.  He worked as a medical director for the William Beaumont Hospital Research Institute from 2005 to 2013, at which time he was forced to resign.  While there, Felten observed firsthand and reported many the under-the-table pay arrangements.

“My findings raised a deeply troubling question,” Felten said. “If someone demonstrates a lack of integrity in their financial dealings, why should I believe that they will show integrity in clinical practice or research?”

Beaumont entered into a five-year Corporate Integrity Agreement with the HHS-OIG to address the kickback scheme as well as resolving its False Claims Act liability.  Shah and his practice also entered into an Integrity Agreement with HHS-OIG, which will include oversight of the company’s billing practices for a three-year period.  However, The DOJ noted there’s been no determination of liability and no admission of wrongdoing.


Cardiologist Coughs Up $2M for Unnecessary Procedures

Detroit Area Hospital System to Pay $84.5 Million to Settle False Claims Act Allegations Arising From Improper Payments to Referring Physicians

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