SightLine Health LLC, an operator of radiotherapy centers throughout the U.S., has agreed, in conjunction with its parent company, Integrated Oncology Network Holdings LLC (ION), to pay the government up to $11.5 million as a settlement to end a more than five-year-old investigation into allegations of false claims.

The Texas-based enterprise is accused of offering financial incentives to physicians in exchange for patient referrals to its cancer treatment centers, and then submitting claims for its services to Medicare, violating the Anti-Kickback Statute. The suit was filed by an unnamed individual under the whistleblower provision of the False Claims Act, which permits private parties to sue on behalf of the U.S. government when they believe false claims are made for government funds, and share in any reward recovered.

“As the professionals charged with recommending and referring medical procedures for our community, physicians’ primary motivation must remain the well-being of their patients,” U.S. Attorney Erin Nealy Cox said in a statement. “Today’s settlement demonstrates our determination to eliminate complex business ventures that improperly interpose financial considerations into our physicians’ medical judgment.”

The Anti-Kickback Statute, designed to protect against compromised medical judgment, prohibits the offering, paying, soliciting or receiving of financial rewards in exchange for induced referrals covered by Medicare, Medicaid and other federally funded programs.

The suit alleges that SightLine, acquired by ION in 2011, violated this policy by setting up a series of independent, turnkey radiation oncology clinics that referring physicians could invest in, and through which they could receive profits generated from their referrals.

In addition to the $11.5 million, ION, SightLine and their related entities will also be subject to a five-year Corporate Integrity Agreement with the HHS-OIG, in which relationships between the ION and SightLine entities and referring physician investors will be monitored internally and externally to increase accountability and transparency, and discourage future misconduct.

Payment will be carried out on an annual basis in the form of $500,000 with interest. A one-time payment of $9 million at the time of a recapitalization of ION will also be due.

For his or her cooperation, the whistleblower will receive up to $1.725 million.

ION professes that the settlement does not reflect a confession of guilt and denies any wrongdoing.

"The settlement reflects that ION has not agreed to any wrongdoing. The matter is solely related to our subsidiary SightLine and its management team prior to our acquisition of SightLine in 2011, and is not related to ION nor our management team," Jeffrey Goffman, CEO of ION, told HCB News. "The matter had nothing to do with ION's compliance or billing practices. We did agree to a CIA with the OIG, but frankly, our compliance program that has always been in existence already covers the majority of the requirements. At ION we take compliance very seriously and have always acted with integrity and in compliance with regulations, and will continue to do so."

ION also filed a lawsuit of its own this week in a Delaware Court against the previous owners of SightLine as part of an attempt to reclaim the cost of the settlement and legal fees.

The DOJ declined an interview with DOTmed on the matter. “We don't have comment beyond what we've said in the press release,” Kerri Kupec, a spokesperson for the DOJ, said in an email.

The investigation was carried out by the U.S. Attorney’s Office for the Northern District of Texas, the Justice Department’s Civil Division, and the HHS Office of the Inspector General.

No determination of liability has been found in this case.