Surgical providers agree to pay $3.4 million to settle False Claims Act violation

July 5, 2021

Acting United States Attorney Karin Hoppmann announced that the Surgical Care Affiliates, LLC (SCA) and Orlando Center for Outpatient Surgery, LP have agreed to pay the United States $3.4 million to resolve allegations that both companies violated the False Claims Act by submitting claims for kidney stone procedures that were not medically justified and for engaging in an illegal kickback arrangement.

The United States previously intervened in a whistleblower lawsuit against SCA and the Orlando Center on Oct. 15, 2019. The lawsuit and settlement relate to the submission of claims for extracorporeal shock wave lithotripsy, a procedure used to break up kidney stones. According to the lawsuit, Dr. Patrick Hunter was a urologist who performed lithotripsy procedures at the Orlando Center, a facility affiliated with SCA. According to the settlement agreement, between January 2010 and April of 2016, the Orlando Center submitted claims for lithotripsy procedures performed on Medicare and TRICARE patients by Dr. Hunter that were medically unnecessary because the procedures were not medically indicated or because the patients did not have kidney stones.

The settlement agreement also resolves allegations that Dr. Hunter, SCA, and the Orlando Center engaged in an illegal kickback arrangement, where Dr. Hunter performed the lithotripsy procedures in exchange for per-procedure payments from the Orlando Center. Dr. Hunter allegedly agreed to perform his lithotripsy procedures at the Orlando Center in exchange for payments from the Orlando Center, in violation of the Anti-Kickback Statute.

SCA vetted and approved the agreement. These procedures were then billed to and paid by Medicare and TRICARE in violation of the False Claims Act. The settlement resulted from a lawsuit originally filed in the United States District Court for the Middle District of Florida by Scott Thompson. Mr. Thompson sued under the qui tam, or whistleblower, provisions of the False Claims Act permitting a private citizen to sue on behalf of the United States for false claims and to share in the recovery. The Act also allows the United States to intervene and prosecute the action. The United States intervened in this matter and litigated the case. Mr. Thompson will receive $748,000 of the proceeds from the settlement with SCA and the Orlando Center.

Dr. Hunter passed away in March of 2019.  In November 2020, Dr. Hunter’s estate paid the United States $1.75 million to resolve the government’s claims arising from Dr. Hunter’s alleged participation in the scheme.

United States Department of Justice has the release.