A settlement has been reached in a whistleblower class action lawsuit brought against St. James Healthcare (St. James), a hospital located in Butte, MT, and its parent company, Sisters of Charity of Leavenworth Health System (Sisters of Charity), a health care organization based in Denver, CO. Both are accused of improperly providing financial benefits to physicians and physician groups that made referrals to the hospital.
The settlement announced today resolves allegations that St. James and Sisters of Charity provided various improper financial incentives to physicians and physician groups that were involved in a joint venture with St. James to own and operate a medical office building on the St. James campus. These incentives included a payment to the joint venture that increased the share values for the physicians and physician groups in the joint venture and resulted in below fair market value lease rates for the physicians renting space in the medical office building. Additional incentives provided by St. James and Sisters of Charity included below fair market value lease rates for the land upon which the medical office building was constructed and other below fair market value arrangements related to shared facilities, use and maintenance. These issues were disclosed by St. James and Sisters of Charity to the government.
