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Prime Healthcare, doctors to pay $37.5 million to settle lawsuit alleging kickback scheme involving Desert Valley Hospital


Victorville Daily Press
Prime Healthcare, its CEO Dr. Prem Reddy and a cardiologist will pay $37.5 million to settle allegations that the company paid kickbacks to the cardiologist when it purchased a rival medical practice in exchange for patient referrals to the company s Desert Valley Hospital in Victorville.
The settlement follows two whistleblower lawsuits, one which also claimed that Prime submitted fraudulent invoices to government healthcare programs with inflated prices for medical implants so the company could receive more money for reimbursement.
The law firm Phillips & Cohen which represented one of the whistleblowers, former Prime employee Martin Mansukhani said the settlement appeared to be the largest “brought against a hospital over kickbacks allegedly paid to a single physician.” ....

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Prime Healthcare, Doctors to Pay $37 Million to Settle Claims of Alleged Kickbacks


ONTARIO, Calif. — Southern California-based Prime Healthcare Services and two of its doctors will pay $37.5 million to settle whistleblower lawsuits that claimed the hospital system paid kickbacks to one of the physicians and bought his practice for more than it was worth, prosecutors said July 19.
Prime Healthcare entered into the settlement with federal and state prosecutors to resolve alleged violations of the False Claims Act, the U.S. Attorney’s Office said in a statement.
The agreement resolves allegations that Prime and its founder, Dr. Prem Reddy, overpaid to purchase Dr. Siva Arunasalam’s physician practice and surgery center because the company wanted the cardiologist to refer patients to its Desert Valley Hospital in Victorville, prosecutors said. ....

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