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TX Radiologist Pays $650,000 In Kickback Case

August 15, 2012
Written by: , Filed in: Medical Ethics, Practice Management
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We didn’t plan this, but it seems to be legal-affairs week here at Radiology Daily. The latest news: a federal prosecutor announced on Tuesday that a Houston-area radiologist had agreed to pay $650,000 to settle claims that he paid kickbacks so that other doctors would send business his way.

Jack L. Baker, MD, the accused radiologist, is president of Fairmont Diagnostic and Open MRI in Pasadena, Texas, just southeast of Houston. Kenneth Magidson, U.S. attorney for the Southern District of Texas, announced the settlement in a news release. In the release, Magidson said:

Improper financial relationships between health care providers and their referral sources can corrupt a physician’s judgment about the patient’s true health care needs.

Prosecutors accused Dr. Baker of “improper financial relationships with up to 17 physicians to induce them to refer patients to Fairmont for a wide variety of imaging studies.” The activities in question, prosecutors said, took place from 2002 through 2010 and violated the False Claims Act, the Anti-Kickback Statute, the Stark Statute, and the Texas Medicaid Fraud Prevention Act.

The illicit financial relationships, according to the news release, included sham personal-services contracts for medical directorships and contracts to pay the salaries of employees in physicians’ offices.

The accusations against Dr. Baker and Fairmont arose in 2010 when Philip Blum, MD, and David Spinks, MD, both doctors practicing in Pasadena, filed a federal whistle-blower lawsuit under the False Claims Act. Pursuant to the provisions of the law, Drs. Blum and Spinks will receive 20 percent of the settlement money.

As part of the settlement agreement, Dr. Baker agreed not to participate in or bill the Medicare and Medicaid programs for six years.

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One Response to “TX Radiologist Pays $650,000 In Kickback Case”

  1. David on August 17th, 2012 at 5:06 pm

    I’m not sure of the specifics, but Dr, Blum ia a neurologist that does his own imaging reads.