Federal charges have been filed against a former Hilton Head Hospital executive accused in an alleged scheme to pay kickbacks and increase Medicaid reimbursements.
Gary W. Lang, Hilton Head Hospital's vice president of business development from 2004 to 2006, was charged July 23. The accusation stems from a "whistle-blower"civil lawsuit that contends prenatal clinic Clinica de la Mama was paid to refer clients to Hilton Head Hospital and four Georgia hospitals for deliveries that would be covered by Medicaid.
The clinic served undocumented, uninsured Hispanic women from 2006 to 2011 on Hilton Head, the Island Packet reported in 2013. It also had clinics in Georgia.
Tracey Cota, the chief operation officer of Clinica de la Mama from 2000 to 2010, also faces federal charges in the case. Cota, who was based in Atlanta, and Lang were charged with conspiracy to violate an anti-kickback statute.
Federal law prohibits hospitals from paying for a referral if the patient's bill will be picked up by a federal health care program, such as Medicaid. Illegal immigrants ordinarily are not eligible for Medicaid coverage, except for medical emergencies, which include child birth.
The suit alleges Tenet Healthcare Corp., which owns Hilton Head Hospital, and Health Management Associates, the Georgia hospital company, entered into agreements with Clinica de la Mama to generate Medicaid revenue from the illegal immigrants that were referred to the hospitals by the clinic for delivery. Hilton Head Hospital also allegedly paid the clinic for these referrals.
The lawsuit states that the referral scheme was started at Hilton Head under Elizabeth Lamkin, Hilton Head Hospital's CEO from 2002 to 2009.
Lamkin has not been charged by the federal government. She is now CEO of PACE, a Hilton Head-based health care management consulting firm. She has declined to comment on the suit. Attempts to reach Lamkin Wednesday were unsuccessful, and she had declined comment in the past.
When Lang left Hilton Head in 2007 to become CEO at Clearview Regional Medical Center in Monroe, Ga., a position he held until 2010, he duplicated the practice, the lawsuit said.
Charges against Lang filed July 23 in federal court in Atlanta allege that he realized the hospitals could illegally gain significant revenue from Medicaid for services to women in labor and their newborns. Lang is accused of entering into contracts with Clinica de la Mama in Lawrenceville, Ga., just as he did on Hilton Head, with the intent of compensating the clinic for the referrals.
Lang has been the CEO of Oasis Health International, a health care management consulting firm on Hilton Head, since March 2011, according to his LinkedIn social media profile. Attempts Wednesday to reach Lang and his attorney, Michael John Trost, were unsuccessful.
Lang and Cota both waived indictment. Lang is scheduled to enter a plea Thursday before U.S. District Judge Amy Totenberg in Atlanta, according to court documents.
Cota pleaded guilty Wednesday to conspiracy to violate the anti-kickback statue and will enter into a plea agreement with the U.S. Attorney's Office, court documents said.
Prosecutors were tipped off by the whistle-blower, Ralph Williams, who worked for one of the Georgia hospitals. Williams was fired after he expressed concerns to hospital executives about the referrals, according to the lawsuit.
The hospitals have argued they had legitimate business relationships with the prenatal care clinics and merely hoped those relationships would generate referrals, according to court documents. They said the contracts between the hospitals and the clinics involved payments for translation, marketing and other services.
The hospitals have not disputed that the prenatal care clinics referred patients for Medicaid-covered deliveries or collected fees from the hospitals. They have said the transactions did not violate federal anti-kickback statutes and no evidence suggests otherwise.
On that basis, they filed the motion to dismiss the suit. U.S. District Judge Clay Land denied that motion June 24.
Follow reporter Laura Oberle at twitter.com/IPBG_Laura.
- Baby-delivery kickback lawsuit advances, July 9, 2014
- Hilton Head Hospital implicated in alleged Medicaid kickback scheme, Sept. 12, 2013