The former CEO of a hospital in Rockdale, Texas, has been sentenced to 36 months in federal prison for a scheme involving paying kickbacks to physicians for laboratory referrals.
From January 2015 to June 2018, Jeffrey Madison, former CEO of critical access hospital Little River Healthcare, allegedly caused the submission of false claims for lab testing to federal healthcare programs, according to a Jan. 15 Justice Department news release.
According to the release, Little River Healthcare and Stamford (Texas) Memorial Hospital partnered with clinical laboratory Boston Heart Diagnostics to operate a kickback scheme.
In October, Mr. Madison agreed to pay more than $5.3 million to resolve the allegations.
The Justice Department also alleged in October that physician Doyce Cartrett Jr., MD, received kickbacks for the referrals. From February to May 2017, Mr. Madison allegedly agreed to have the hospital pay Dr. Cartrett $2,000 a month in purported medical director fees after he informed the former CEO of potential referral volume. The hospital did not receive any genuine medical director services from Dr. Cartrett.