Broward Health to Pay $69.5 Million to Settle False Claims Charge

One of the nation’s largest public hospital systems, South Florida’s Broward Health, will pay $69.5 million to settle allegations that it violated Medicare billing laws that ban paying physicians for referrals.

The agreement is the largest settlement without litigation ever reached under the law prohibiting physician compensation that presents a financial conflict of interest.


The settlement stems from a 2010 whistleblower complaint brought by Dr. Michael T. Reilly, a Ft. Lauderdale orthopedic surgeon who alleged that Broward Health violated the Physician Self-Referral Law, commonly called Stark Law, by paying physicians based in part on referrals to Broward Health hospitals.

Dr. Reilly’s whistleblower share of the award was set at $12 million.

Broward Health also paid Dr. Reilly’s attorney’s fees and expenses.

The Stark Law bans compensating employed physicians based on “the volume or value of referrals” to avoid financial incentives that may not be in patients’ best interests and that drive up Medicare costs.

It also bans billing Medicare for those referrals.

Broward Health allegedly over-compensated certain employed physicians across multiple specialties, including cardiology, orthopedic surgery, and oncology.

The complaint was filed under the provisions of the False Claims Act, which permits whistleblowers to bring a lawsuit on behalf of the federal government.

‘”The Stark laws provide important protections for patients,” said Bryan Vroon, the Atlanta-based attorney who represented Dr. Reilly. “This case shows that whistleblowers can have a major impact by stepping forward in the best interests of patients and taxpayers. I admire Dr. Reilly’s courage and convictions in his 12-year effort to bring reform to Broward Health.”

“As a result of this investigation, Broward Health has announced a major new policy for physician compensation that will not pay physicians based on the value of referrals,” said Dr. Reilly. “This change in policy, settlement agreement, and the Corporate Integrity Agreement are important for reform and patient care at Broward Health.”

In addition to the $69.5 million payment to the government, the settlement requires Broward Health to enter into a Corporate Integrity Agreement with the U.S. Department of Health and Human Services Office of Inspector General.

The Corporate Integrity Agreement obligates Broward Health to undertake substantial internal compliance reforms and submit its federal health care program claims to independent review for the next five years.


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