Last week, Sumter, South Carolina-based Tuomey Healthcare System and the federal government reached a settlement that resolves a federal court’s verdict finding that Tuomey violated the False Claims Act (FCA). The court found Tuomey liable for $237 million in damages, which is the largest FCA verdict against a community hospital and exceeds Tuomey’s annual revenue. The settlement reduces Tuomey’s financial obligation to $72.4 million and requires Tuomey to be sold to Palmetto Health in Columbia, South Carolina.

The case involves employment agreements Tuomey entered into with nineteen specialty physicians. The federal government alleged that Tuomey based the physicians’ compensation, at least in part, on the volume or value of referrals the physicians made to Tuomey for outpatient procedures.

The lawsuit has a lengthy history, dating to 2003. For more details about the case’s progression please visit a previous article here.