John Hopkins Health, Sibley Memorial settle Stark Act violations

Johns Hopkins Health System and Sibley Memorial Hospital have settled allegations of improper payments for $5 million.

The Justice Department said Monday that Sibley Memorial in Washington, D.C., allegedly violated the Stark Law from 2008 to 2011 by billing Medicare for services referred by 10 cardiologists with whom the hospital had a financial relationship.

“Johns Hopkins Medicine discovered and flagged a technical noncompliance with the Stark Act in 2011 as part of an onboarding assessment of Sibley Memorial Hospital,” a health system spokesperson wrote in an email. “We self-reported immediately and are working with the Department of Justice to close this case in 12 years.”

Both the Stark law and the anti-kickback law help ensure that physicians’ medical decisions are based on the interests of the patient rather than financial incentives. The Stark Law, formally called the Physician Self-Referral Law, prohibits hospitals from billing Medicare for services referred by physicians with whom they have a financial relationship, unless an exception applies. The anti-kickback law prohibits offering or accepting financial payment for referrals for services covered by Medicare or Medicaid.

Johns Hopkins Medicine, based in Baltimore, Maryland, consists of the Johns Hopkins Health System and the Johns Hopkins School of Medicine. It operates six academic and community hospitals in Maryland, the Washington, DC area, and Florida. The system acquired Sibley Memorial Hospital in 2010 in a non-cash affiliation deal.

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