US Hospital Giant fined 513 million dollars over kickback scheme

New York : US hospital giant Tenet Healthcare and two of its subsidiaries will pay $513 million to settle charges it bribed prenatal care clinics to win referrals to hospitals in the southern US.

Tenet paid bribes and kickbacks to clinics serving primarily undocumented Hispanic women in Georgia and South Carolina to drive referrals to Tenet facilities and win more than $145 million in Medicaid and Medicare funds, the Justice Department said.

"When pregnant women seek medical advice, they deserve to receive care untainted by bribes and illegal kickbacks," said David Bitkower of the Justice Department's criminal division.

The clinics involved falsely told the women their costs associated with childbirth would only be covered under Medicaid if they went to a Tenet hospital, according to the charges.

Tenet "exploited some of the most vulnerable members of our community and took advantage of a payment system designed to ensure that underprivileged patients have choices in receiving care," said US Attorney John Horn of the Northern District of Georgia.

Under a civil settlement, Tenet agreed to $368 million to resolve a lawsuit filed by the US and Ralph Williams, a whistleblower.

In the criminal case, two Atlanta based Tenet subsidiaries, Atlanta Medical Center and North Fulton Medical Center, pleaded guilty to fraud and violating anti-kickback laws. They will forfeit $145 million in ill-gotten gains obtained through the federal programs.

The subsidiaries entered into a non-prosecution agreement with US prosecutors under which they must cooperate with the government's ongoing investigation, enhance their compliance programs and install an independent monitor.

Shares of Tenet tumbled 3.8 percent to $21.80 in late-morning trade.