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S.C. health system ordered to pay $276M in billing fines

October 2, 2013
by Pamela Tabar, Editor-in-Chief
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The Tuomey Healthcare System, Sumter, S.C., has been ordered to pay $276.8 million in penalties by a federal judge, including $237.4 million in false Medicare claims and another $39.3 million in kickbacks that violated the Stark Law.

The decision, handed down Tuesday in the U.S. District Court in Columbia, S.C., followed eight years of legal battles between the health system and federal agencies, stemming from a 2005 lawsuit brought by a former employee. In the original suit, a whistleblower brought allegations of physician kickbacks for referrals to post-acute and outpatient care services paid for by Medicare and Medicaid, according to a Law360 report.

Tuomey has the option to request a settlement, although its legal defense team plans to appeal again, according to a statement from Board Chair John Brabham. Meanwhile, Tuomey President and CEO Jay Cox and Executive Vice President and Chief Operating Officer Gregg Martin announced their impending resignations last week, and the health system’s representing law firm also stepping down. The changes in leadership and representation may encourage federal agencies to agree to a settlement, noted an article in The (S.C.) State.

The Tuomey Healthcare System suit is one of the largest in U.S. history for damages against a community hospital system and its outpatient subsidiaries, involving more than 21,000 Medicare claims.