SC hospital to pay $36.5 million to settle alleged kickback scheme, does not admit guilt

Bon Secours St. Francis healthcare system has agreed to pay $36.5 million to resolve a lawsuit that alleged illegal bonuses were paid to orthopedic surgeons based on the amount and value of referrals to the Greenville hospital.

Bill Nettles, a Columbia attorney and former U.S. attorney for South Carolina, said Thursday his client filed the lawsuit several years ago alleging knowledge of a kickback scheme. The U.S. Attorney’s Office reviewed it but declined to take the case.

“Despite the Department of Justice declination, we remained steadfast, and believed in the validity and strength of our case,” he said. “This represents the third false claims case that the Law Office of Bill Nettles has pursued successfully after initially being declined by the Government in the last three years.”

He said the settlement is the largest ever in a false claims case that had been declined by the Justice Department in the state,

His client, who has not been named, will receive $10.2 million.

The federal government gets the rest, Nettles said.

“Medical providers should base health care decisions on what is best for the patient, and not on financial incentives and related schemes,” said U.S. Attorney Adair F. Boroughs for the District of South Carolina.

Erica Blake, spokesperson for the healthcare system, released a statement disputing the allegations made about the physician employment arrangement, which ended five years ago.

“Reaching a settlement enables us to place our focus where it belongs – continuing to compassionately serve patients and communities by providing the high-quality, Mission-centric care that our community has come to expect without the disruption this kind of litigation can pose,” she said.

The lawsuit alleged the Greenville healthcare system violated the False Claims Act, the Federal Stark Law, and the Federal Anti-Kickback Statute.

“The settlement resolves allegations that St. Francis caused the submission of false claims to Medicare and to TRICARE as a result of an unlawful contractual payment structure between St. Francis and Piedmont Orthopedic Associates.

This story was originally published June 15, 2023 at 12:47 PM.