OIG Enters Into $2 Million Civil Monetary Penalty Settlement With Radiology Practice

A Las Vegas, Nevada radiology practice, West Valley Imaging Limited Partnership, and its principals, William L. Boren, M.D. and Luke S. Cesaretti, M.D., will pay $2 million and comply with the terms of an Integrity Agreement for five years to resolve allegations that they submitted false or fraudulent claims to Medicare, under a Civil Monetary Penalty (“CMP”) settlement agreement announced by the Office of Inspector General (“OIG”) for the Department of Health and Human Services on March 25, 2009.

One of the largest CMP settlements ever negotiated under the OIG’s CMP authority, the West Valley CMP Settlement announcement comes just one day after the OIG announced changes to the conditions under which health care providers can use the OIG’s Self-Disclosure Protocol (“SDP”) to resolve CMP exposures for federal health care fraud violations and established $50,000 as the minimum settlement amount under the SDP program.

The West Valley CMP settlement resolves OIG charges that the defendants intentionally defrauded Medicare by improperly providing diagnostic tests to Medicare beneficiaries without the required treating physician’s orders; billing for certain tests under Current Procedural Terminology codes not supported by the medical records; and failing to satisfy certain other Medicare billing and coverage requirements.

The West Valley CMP settlement reflects the growing perils that health care providers face when charged with violating the Stark Law, Anti-Kickback Statute or other federal health care fraud laws.  Health care providers should seek consult with qualified legal counsel within the scope of attorney-client privilege about the adequacy of their current policies and procedures and the development, implementation and enforcement of appropriate policies and practices to manage exposures to health care fraud or other liabilities taking into account the specific nature and scope of that health care provider’s health care operations. As part of this process, health care providers should work with their legal counsel within the scope of attorney-client privilege to decide and implement appropriate oversight and audit procedures and processes for investigating and addressing any issues that might arise in connection with an audit. While each health care provider generally should work with their legal counsel to define the scope and other particulars of such audit, every health care provider as part of this effort generally should undergo a periodic assessment by outside counsel of the adequacy of its Stark compliance efforts.


For assistance in reviewing and updating your Stark Law, Anti-Kickback Statute, or other health care compliance and risk management policies, practices or programs, assessing the strength of your controls in addressing these laws or other healthcare laws and regulations, or in addressing other compliance or health care concerns, please contact Cynthia Marcotte Stamer at cstamer@solutionslawyer.net or 469.767.8872.

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