The Illinois attorney general has joined a whistleblower lawsuit against several imaging center companies in the Chicago area, charging them with paying kickbacks to referring doctors under cover of phony equipment leasing arrangements.
The lawsuit targets a practice that has become increasingly common in the imaging center industry, in which an imaging facility "leases" blocks of time on its imaging equipment to referring physicians. The referring physicians pay a lower rate for imaging studies but charge insurance payors a higher rate, and pocket the difference.
In the Illinois case, a radiology center operator in Illinois filed the lawsuit in 2006 in Cook County Circuit Court on behalf of the state. The lawsuit remained under seal while the attorney general's office investigated the allegations and determined whether to join the case.
The lawsuit names MIDI, a Virginia-based company that operates 13 MRI centers in Illinois. The suit also names several other Chicago radiology centers, according to the attorney general's office.
The lawsuit charges the centers with violating the state's Consumer Fraud and Deceptive Business Practices Act, as well as Illinois' antikickback law, the Insurance Claims Fraud Prevention Act. It asks the court to order the defendants to halt their leasing arrangements and seeks money damages, restitution, and penalties.
By AuntMinnie.com staff writers
January 18, 2007
Related Reading
CA bill to ban leasing deals moves forward, July 10, 2006
California bill targets imaging lease arrangements, April 27, 2006
As more referrers demand leases, rads hope for legal crackdown, May 5, 2005
States, payors seek to stem tide of self-referral abuse, October 29, 2004
Stark II interim final rule leaves huge self-referral loophole, July 20, 2004
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