21st Century Oncology, a national chain of cancer treatment centers based in Fort Myers, Florida, agreed to pay $26 million to the US government after disclosing that it had falsely attested to its providers’ use of electronic health records (EHRs) in order to obtain financial incentives under the meaningful use program, the Department of Justice announced in a news release on Tuesday.
In addition, the settlement resolved allegations that the company and its subsidiaries had violated the False Claims Act by submitting claims for services they had provided “pursuant to referrals from physicians with whom they had improper financial relationships.” These actions also violated the physician self-referral law, better known as the Stark Law, according to the news release.
The Stark Law allegations were first brought in a lawsuit filed by a former 21st Century Oncology executive under the qui tam provisions of the False Claims Act.
The company, which operates 179 treatment centers, submitted false attestations to the Centers for Medicare & Medicaid Services concerning employed physicians’ use of EHRs, the Department of Justice said. To support those attestations, “its employees falsified data regarding the company’s use of EHR software, fabricated software utilization reports, and superimposed EHR vendor logos onto the reports to make them look legitimate.”
Neither in this case nor in the one regarding financial inducements for referrals did the department say anything about prosecutions of the physicians involved.
Not the First Time
In addition to the civil settlement, 21st Century Oncology has entered into a 5-year corporate integrity agreement with the Office of Inspector General of the US Department of Health and Human Services (HHS). The company is obligated to undertake internal compliance reforms and to submit to outside review.
In 2015, 21st Century Oncology settled allegations of different violations of the False Claims Act by paying the government $19.75 million. Those allegations, also part of a whistleblower suit, claimed that the company had billed federal health programs for unnecessary lab tests. According to the government, these tests were ordered by four of the firm’s urologists, all of whom practiced in the Fort Myers area.
21st Century Oncology filed for Chapter 11 bankruptcy this past May. According to the publication Fierce Healthcare, the company cited changes in reimbursement, political uncertainty, and the cost of complying with EHR regulations. But it is apparent that government settlements also contributed to its bankruptcy.
A federal bankruptcy judge recently approved relief from a settlement between 21st Century Oncology and HHS that resulted from a major security breach in 2015. The Federal Bureau of Investigation notified the company of the breach, which compromised medical and other personal information on 2.2 million people. HHS’s Office of Civil Rights found that the company had failed to safeguard personal health information and had disclosed some personal health information to third-party vendors without having them sign a business associate agreement. The company agreed to pay a $2.3 million fine to HHS and to take corrective action.
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