Adventist Health System to Pay $118.7 Million, One of the Largest Settlements in Health Care Fraud: Some Whistleblower is Going to Get Rich!

Thursday, October 1, 2015
By George F. Indest III, J.D., M.P.A., LL.M., Board Certified by The Florida Bar in Health Law

Adventist Health System ("Adventist") recently reached a settlement with the United States government and four states, including Florida, totaling a whopping $118.7 million.  A significant amount of that total--$47 million--is the result of allegations stemming from Florida Hospital Medical Group (owned by Adventist), and more than 30 Florida Hospitals throughout the state, including several central Florida area hospitals.  

The settlement was the result of allegations that originated from two separate whistleblower lawsuits, one filed in 2012 and the other in 2013, by three employees and one former Adventist systems senior health care executive.  The allegations were based on the existence of reported unlawful financial relationships between the hospital and various doctors.  These alleged financial relationships constituted violations of the Stark Law and the False Claims Act.  

For the press release, click here

The Alleged Scheme.

The complaints allege that the health care fraud scheme began with the implementation of a new corporate policy initiated by Adventist.  The reported policy directed Adventist's hospitals to purchase physician practices and to employ physicians in their surrounding areas to essentially control all patient referrals for the entirety of that hospital's geographic location.  

In exchange for the sale or employment, Adventist hospitals were allegedly urged to compensate doctors well above fair market value as well as provide the physicians with additional perks, bonuses and other benefits.

The losses incurred were reportedly absorbed as a small consequence of the deals, which allegedly resulted in a steady stream of physician referrals.  It is reported that a significant revenue was generated from these referrals due to the submission of many false or fraudulent claims to government health care programs such as Medicare and Medicaid (and elsewhere) for reimbursements.  

Click here to read another one of our recent blogs about a case involving another health care system in Florida allegedly involved in similar fraudulent activity. 

Health Care Fraud is Serious Business.

The government agreed to the significant settlement with Adventist as to the allegations of fraud.  The United States government is to receive $115 million of the settlement with the remaining portion to be paid to the four states reportedly involved in the allegations, including Florida.  No liability has been determined.

To view the full settlement agreements for each case, click here and here

The government enacted anti-fraud laws in health care to eliminate fraud and abuse in government health care programs and to protect tax payers' dollars.  This protects the integrity of the health care system as a whole by focusing on the utmost care of the patient rather than the financial interest of the physician or other health care provider.  

Click here for information directed at physicians regarding how to best avoid fraud and abuse in government health care programs.

The case at-issue was brought under the Stark Law and the False Claims Act.  The Stark Law was adopted to eliminate unlawful financial relationships between physicians and other health care entities.  Financial relationships that offer incentives for referrals and services could potentially cloud a physician's professional judgement resulting in unnecessary treatments, improper referrals, and the overuse of government services such Medicare and Medicaid.  

The intent behind the False Claims Act (FCA) is to assist the government in recovering funds unlawfully obtained due to fraudulent practices.  Whistleblowers who file cases under the qui tam provision of the FCA are able to receive a percentage of the losses recovered by the government.  This incentive is provided to encourage employees or other individuals to come forward with any knowledge of fraud they may be privy to, and to further disparage those considering fraudulent activity.  

To learn more about whistleblower/qui tam cases under the FCA, read our two-part blog.  Click here for part one and click here for part two.

Due to the extreme nature of health care fraud cases, the government encourages immediate action to be taken if you are aware of fraudulent activity.  Furthermore, if you are faced with allegations of fraud or abuse in violation of any government health care anti-fraud laws, you need to immediately seek advice and representation of an experienced health attorney.  

Contact Health Law Attorneys Experienced with Qui Tam or Whistleblower Cases.

Attorneys with The Health Law Firm also represent health care professionals and health facilities in qui tam or whistleblower cases both in defending such claims and in bringing such claims. We have developed relationships with recognized experts in health care accounting, health care financing, utilization review, medical review, filling, coding, and other services that assist us in such matters. We have represented doctors, nurses and others as relators in bringing qui tam or whistleblower cases, as well.

To contact The Health Law Firm, please call (407) 331-6620 or (850) 439-1001 and visit our website at


Department of Justice, Office of Public Affairs.  "Adventist Health System Agrees To Pay $115 Million To Settle False Claims Act Allegations."  Press Release.  21 Sept. 2015.  Web.  24 Sept. 2015.

Miller, Naseem.  "Adventist Will Pay $118.7M in Fraud Case."  Orlando Sentinel.  23 Sept. 2015: A1-A8.  Print.  

About the Author: George F. Indest III, J.D., M.P.A., LL.M., is Board Certified by The Florida Bar in Health Law.  He is the President and Managing Partner of The Health Law Firm, which has a national practice.  Its main office is in the Orlando, Florida area. The Health Law Firm, 1101 Douglas Ave., Altamonte Springs, FL 32714, Phone: (407) 331-6620.

Keywords:  Stark Law defense attorney, False Claims Act defense attorney, health care fraud, anti-fraud laws attorney, Medicare and Medicaid attorney, fraudulent practices in health care, whistleblowers lawyer, FCA violations, fraud detection, qui tam lawyer, financial interest in physician referrals, health attorney, defense attorney, The Health Law Firm, health law firm, fraud investigations, conflict of interest in physician referrals, Medicare billing, Federal health care program fraud, referrals under the federal health care program, unlawful financial relationship with physician, The Health Law Firm reviews
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