A Hudson Valley hospital paid doctors millions behind the scenes, state investigators say, to steer cancer patients its way.
Attorney General Letitia James announced a settlement requiring New York-Presbyterian Hudson Valley Hospital to pay more than $616,000 after investigators found the hospital made illegal kickback payments to a Westchester County oncology practice in exchange for patient referrals.
The payments allegedly led to about 114 cancer patients being referred to the hospital for oncology services.
Millions paid for referrals
According to the investigation, the conduct stretched from January 2011 through December 2019 and involved both New York-Presbyterian Hudson Valley Hospital and its predecessor, Hudson Valley Hospital Center.
During that period, the hospital allegedly paid the oncology practice more than $4 million under three separate agreements. Investigators said some of the work tied to those agreements was not performed, not performed as required, or lacked time records altogether.
The state says the real purpose of the payments was to induce doctors at the practice to refer their patients to the hospital for cancer treatment.
False Medicaid claims
As a result of the alleged kickback scheme, investigators found the hospital submitted false claims to New York’s Medicaid program, violating the New York State False Claims Act.
Under the settlement with the Office of the Attorney General and the U.S. Attorney’s Office for the Southern District of New York, the hospital will pay $616,676.14 in damages.
More than $367,000 of that money will go directly back to New York’s Medicaid program. The remaining funds will be returned to the federal government.
“New Yorkers should be able to trust that their doctors are making decisions based on their best interests, not financial incentives,” James said.
Whistleblower sparked the case
The case began with a lawsuit filed by a former employee under state and federal whistleblower laws. Those laws allow private individuals to sue on behalf of the government when they believe fraud is occurring.
Because of that filing, the former employee will receive a portion of the settlement.
The investigation was handled jointly by the Attorney General’s Medicaid Fraud Control Unit and federal prosecutors.
State officials say the case underscores ongoing efforts to crack down on financial arrangements that undermine patient trust and inflate public health care costs.
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