According to a report in the Indy Star, Community Health Network has agreed to pay $135 million to resolve allegations that it overpaid physicians to secure patient referrals, violating state and federal laws. The case, initiated by whistleblower Thomas P. Fischer, a former top executive at the Indianapolis-based hospital system, claimed the excessive compensation constituted illegal kickbacks.

Fischer, who served as Community’s Chief Operating Officer and Chief Financial Officer, expressed hope that the settlement would inspire others in healthcare to report potential fraud. “These settlements should empower individuals to speak out against fraud internally or to the government if necessary,” he stated through his attorneys.

The allegations are part of a broader investigation into the hospital system’s compliance with the Stark Law, which bars Medicare billing for certain services referred by physicians with financial ties to the hospital. In December 2023, Community paid $435 million to settle a similar case involving Medicare fraud, bringing the total settlement amount to $570 million. Despite the payments, Community denies any wrongdoing, emphasizing that the legal disputes did not compromise patient care.

“This matter involved a complex, highly regulated area of physician compensation,” said spokesperson Kris Kirschner, reaffirming the hospital’s adherence to ethical standards.

The settlement concludes a case that began with a 2008 investigation and escalated when the Department of Justice sued Community in 2020. Meanwhile, Community has advanced its healthcare services, forming a partnership with MD Anderson to enhance cancer care in Indianapolis.

This resolution highlights ongoing scrutiny of physician compensation practices and the potential for whistleblowers to shape healthcare accountability.