Hunt Valley, MD-based real estate investment trust Omega Healthcare Investors will pay $3 million to settle kickback allegations against Omega-owed MedEquities Realty Trust, the Department of Justice announced Wednesday.
The claims resolved by the settlement are allegations only, and there has been no determination of liability, the DOJ noted.
Omega acquired MedEquities in 2019 in a $600 million transaction. Omega is successor-in-interest to MedEquities, according to the Justice Department, meaning that it has an ownership interest in the Nashville TN-based REIT.
According to the claim, MedEquities violated the False Claims Act by submitting false claims to the Medicare and Medicaid programs. Robert Van Boven, MD, and Sharon Van Boven filed the lawsuit filed under the whistleblower provisions of the FCA, which permit private parties to sue on behalf of the government for false claims and to receive a share of any recovery. The lawsuit remains under seal, with an exception that permits the government to disclose the settlement.
MRT of Lakeway TX – ACH LLC and Lakeway Realty LLC also are parties to the settlement agreement. The government alleged that MedEquities paid kickbacks to physicians to induce them to refer patients to a hospital developed by Lakeway Regional Medical Center LLC. Additionally, MedEquities allegedly offered the physicians a “low-risk, high-reward” investment in Lakeway Realty, a joint venture formed by MRT-Lakeway to purchase the hospital and lease it back to LRMC.
According to the Justice Department, claims for reimbursement based on those referrals and submitted by LRMC to Medicare and Medicaid between March 2, 2015, and Aug. 31, 2016, were unlawful under the federal Anti-Kickback Statute.
According to the DOJ, Lakeway Regional Medical Center in 2020 settled its lawsuit for approximately $1.1 million.
Omega Healthcare Investors did not respond to a request for comment from the McKnight’s Business Daily by the production deadline.
