A man described by prosecutors as "a prominent Houston radiologist" has agreed to pay $650,000 to settle claims that he provided kickbacks to get physicians to refer business his way.
Jack L. Baker of the Fairmount Diagnostic Center in Pasadena entered into the agreement today, settling claims filed under the False Claims Act, the Anti-Kickback Statute, the Stark Statute and the Texas Medicaid Fraud Prevention Act between 2002 and 2010, prosecutors say.
"Improper financial relationships between health care providers and their referral sources can corrupt a physician's judgment about the patient's true healthcare needs," U.S. Attorney Kenneth Magidson said."In addition to yielding a substantial recovery for taxpayers, this settlement will prohibit Baker from participating in the Medicare and Medicaid programs for six years, which should deter similar conduct in the future."
Prosecutors say Baker entered into improper financial relationships with 17 physicians in order to get them to refer patients to Fairmount.
"These prohibited financial relationships included (1) sham personal services contracts (medical directorships) which took into account the value of referrals from the medical directors and (2) contracts to pay the salaries of employees in physicians' offices, which also took into account the value of referrals from those physicians," prosecutor say.
Such arrangements "are prohibited for a variety of reasons, including that they increase the cost of health care by incentivizing physicians to make referrals for unnecessary tests," they said.
As part of the agreement, Baker has also said he would not bill through Medicare or Medicaid for six years.