PHILADELPHIA – The United States and Aria Health Systems, Inc. ("Aria") today settled two False Claims Act matters which Aria self-disclosed, announced United States Attorney Zane David Memeger. Aria agreed to pay $564,700 to resolve claims that a cardiologist performed unnecessary invasive procedures on inpatients and outpatients at their Torresdale Campus between October 1, 2012 and April 15, 2013. Aria also agreed to pay $2.5 million to resolve alleged violations of the False Claims Act regarding compensation to physicians that were in excess of fair market value. The settlement resolves claims regarding compensation paid to a cardiac thoracic surgeon from 2012 to 2014 and claims regarding the purchase of a trademark name in the course of the acquisition of an orthopedic group by Aria in December 2012. Aria is a major health care provider in Northeast Philadelphia and lower Bucks County.
Aria became aware of certain complaints regarding the cardiologist in January 2013. They hired an independent review organization that reviewed the medical treatment for some of his patients. As a result of the review, the doctor agreed to cease performing invasive cardiac procedures at the end of February 2013 and agreed to terminate his employment with Aria as of April 15, 2013. After further review, Aria self-disclosed this matter to the United States in March 2014.
The False Claims Act and the Stark Act require that physicians be paid salaries that are no more than fair market value and may not include compensation for referrals of patients. Aria self-reported the cardiac thoracic surgeon contract to DOJ based on a concern that his $1.4 million annual compensation was outside fair market value. With respect to the trademark purchase, Aria paid $3.5 million dollars for the right to use the trademark in perpetuity. Aria’s own internal investigation, conducted in 2014, found that the trademark payment was inflated above fair market value based on an independent valuation.
“Patients have a right to medical treatment that is ethical and necessary and not influenced by a physician’s strategy to increase his compensation,” said Memeger. “In this case, Aria recognized a problem, reported it to the government, and voluntarily made internal changes to its operations.”
The settled civil claims are allegations only. There has been no determination of civil liability, and Aria denies any such liability. The case involving improper physician compensation and purchase of a trademark was handled by Assistant United States Attorney Thomas Johnson and Health Care Fraud Analyst Raymond Uhlhorn; the allegations concerning Aria’s unnecessary invasive procedures were handled by Assistant United States Attorney Susan Dein Bricklin and Health Care Fraud Analyst George Niedzwicki. The Office of the Inspector General of the Department of Health and Human Services assisted in both investigations.