Phoenix-based OASIS Hospital pays $5.6M after feds allege doctors were paid for patient referrals

PHOENIX — A Phoenix‑based surgery center has agreed to pay $5.6 million to settle a Department of Justice complaint alleging it paid local doctors to steer patients to their clinic.

Southwest Orthopedic and Spine Hospital LLC, which operates as OASIS Hospital, agreed to settle allegations that it violated the False Claims Act, according to a settlement released Tuesday, Feb. 24.

Federal investigators said that between 2011 and 2018, OASIS made improper payments to Southwest Orthopedic and Spine Hospital Physicians Group. OASIS allegedly paid the doctors by giving them bonds and then paying them interest on those bonds.

“As this settlement reflects, we will hold accountable those who violate these important safeguards, but we will also give credit when resolving such misconduct to those who fully disclose their mistakes, take appropriate remedial actions, and meaningfully cooperate with the government’s investigation,” Assistant Attorney General Brett Shumate said in a statement.

DOJ officials allege those payments broke federal anti‑kickback laws that ban giving financial incentives in exchange for patient referrals.

Acting Deputy Inspector General Scott Lampert at the Health and Human Services Office said schemes like this can drive up healthcare costs for everyone.

“Kickback schemes undermine the medical decision-making of medical professionals,” Lampert said.

OASIS reported the issue after a 2019 internal audit and voluntarily disclosed the payments to federal authorities, according to the Justice Department. Investigators said the hospital and its parent company cooperated fully.

Under federal law, the Anti‑Kickback Statute bars paying for patient referrals, and the Stark Law prohibits billing Medicare for services ordered by physicians who have certain financial ties to a hospital.

The settlement includes no admission of wrongdoing.

Read more Arizona health news on KTAR.com.

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