In October 2011, Nolan Auerbach & White announced the $7.5 million settlement of its client’s False Claims Act qui tam action, alleging that Select Medical paid suspect “Medical Director” payments to a number of Ohio physicians. Recently, HHS-OIG put the medical community on notice when it released a Fraud Alert, warning that certain physician compensation arrangements, including medical directorships, may run a high risk of violating the Anti-Kickback Statute (“AKS”).

The Alert stated that although many physician compensation arrangements are legitimate, “a compensation arrangement may violate the anti-kickback statute if even one purpose of the arrangement is to compensate a physician for his or her past or future referrals of Federal health care program business.”

HHS-OIG stressed that the physician compensation arrangements must provide a fair market value price for the actual services a physician provides. In other works, AKS concerns abound when hospitals continue paying out large sums to so-called “Medical Directors” who regularly skip out on their directorship responsibilities.

More information for potential whistleblowers is located at the Nolan Auerbach & White website.