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A Cautionary Tale On Hospital-Physician Alignment Structures


MMM Healthcare Partners Bob Threlkeld and Elliott Coward recently wrote an article for Law 360 regarding the importance of carefully structuring hospital-physician alignment relationships in light of a recent False Claims Act settlement involving Community Health Network. 

The case against the Community Health Network highlights the complexities and legal constraints surrounding healthcare systems, particularly concerning compensation and referrals.  Community Health Network agreed to pay a staggering $345 million fine to resolve allegations that it violated the False Claims Act and the Stark Law with improper employment and compensation of breast surgeons, cardiovascular surgeons, and other specialist physician groups.  The government claims that the network’s integration approach violated regulatory standards by relying on reimbursement disparities and bonus schemes tied to referrals.  The settlement underscores the importance of adhering to regulatory frameworks and demonstrating the commercial reasonableness of compensation agreements. 

Click the link below to read the full article.

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