Md. hospital to pay $22 million
St. Joseph Medical Center has agreed to pay $22 million to settle federal claims that it engaged in a decade-long, illegal kickback scheme with the cardiology group MidAtlantic Cardiovascular Associates, which was co-founded by Mark G. Midei - the cardiologist accused of performing hundreds of unwarranted medical procedures at the Towson, Md., hospital.
Included in the settlement, which was announced Tuesday by the Maryland U.S. attorney's office, is the repayment of federal funds that St. Joseph received for "medically unnecessary" coronary stents placed by Midei after he had left MidAtlantic to become a full-time St. Joseph employee with a seven-figure salary.
In a statement, St. Joseph said it "reached the agreement without admitting liability in order to avoid the expense and uncertainty of litigation and to allow the medical center to move forward."
MidAtlantic, located in Pikesville, a Baltimore suburb, did not respond to a request for comment.
St. Joseph was accused of paying MidAtlantic kickbacks - disguised as payments for services - in exchange for patient referrals for "lucrative cardiovascular procedures" from 1996 to 2006, when Midei was a partner there, according to the 17-page settlement agreement.
St. Joseph also "submitted false claims for medically unnecessary stent procedures performed by Dr. Mark Midei," the document states.
"Kickbacks give doctors an incentive to pursue unnecessary treatments that are costly and sometimes even dangerous to patients," Rod J. Rosenstein, U. S. attorney for Maryland, said in a statement.
More than 100 patients have filed malpractice claims against the hospital and Midei, who was removed from duty in May 2009 under suspicion that he had falsified patient records to justify unneeded stent procedures. A physician oversight board has since filed charges against him.
Midei filed a suit against St. Joseph last month in which he said that officials there ruined his reputation by warning nearly 600 patients about his work. He has denied all allegations against him.
His attorney, Stephen L. Snyder, said Tuesday that the settlement says nothing about his client. "This is a recognition that St. Joe acted improperly. . . . It has no acknowledgment as to Dr. Midei," Snyder said.