After trial, appeal, reversal, and a re-trial together with a multitude of legal motions, a Federal Judge has finally ruled that a South Carolina hospital owes the federal government $276 Million in reimbursement, fines, and penalties over an arrangement with doctors that was found to violate Medicare rules against compensating doctors for referrals to a hospital.
Shortly after the verdict was announced October 1, 2013, the CEO and the legal firm representing the Toumey Healthcare System in Sumpter, SC announced their planned resignations from the hospital. Commentators indicated that the move was to remove personality issues that might be an obstacle to further negotiations with the US Attorney’s office on the case. Continued negotiations and possible appeals on the case leave the ultimate resolution of the case in doubt.
The case was brought as a “whistle-blower” case by a physician who practiced at the 266-bed community hospital. As such, this physician could receive a portion of any verdict recovered in the case. The hospital CEO, the Board of the hospital, and legal counsel stood committed throughout the process in their position that the contracts were not in violation of the Medicare rules.