Ferrell-Duncan to pay $1M for CoxHealth relationship

Ferrell-Duncan Clinic Inc. will pay $1 million in a settlement with the federal government over allegations that the medical practice had prohibited financial arrangements with Cox Medical Centers.

The settlement agreement alleges that, beginning in January 1996, the for-profit practice of about 100 physicians entered into arrangements that induced doctors to refer patients to Cox, which violates the federal Stark Law and Anti-Kickback Statute, according to a news release from the U.S. Attorney for the Western District of Missouri.

Ferrell-Duncan will pay $1 million - plus 4 percent interest that began June 24 of this year - no more than five business days after the agreement's effective date. The settlement resulted from an ongoing investigation by the Health and Human Services Office of Inspector General, Office of Investigations, Office of Audit Services and the FBI that started in early 2003.

CoxHealth also reached a settlement in July to resolve the claims of illegal agreements with Ferrell-Duncan physicians, as well as the government's allegations that CoxHealth improperly submitted Medicare cost reports, incorrectly reported overhead, and that it improperly billed Medicare for certain treatments. That settlement stipulated that CoxHealth pay $60 million and participate in a five-year program of legal compliance education for employees.