Minnesota-based heart device manufacturer, St. Jude Medical Inc., and two hospitals have agreed to pay the United States a total of $3,898,300 to settle allegations that St. Jude paid illegal kickbacks to the hospitals to induce them to purchase equipment from St. Jude’s.  According to the government, the kickback scheme led to violations of the federal False Claims Act by causing the submission of false claims to federal health care programs.

The settlement calls for St. Jude to pay $3,725,000, while Parma Community General Hospital in Parma, OH, will pay $40,000, and Norton Healthcare of Louisville, KY will pay $133,000. 

The false claims allegations were first raised by a whistleblower, Jerry Hudson, in a qui tam lawsuit.  Mr. Hudson will receive $640,050 of the amount recovered. 

Click here to read the Department of Justice press release, “Heart Device Manufacturer in Minnesota and Hospitals in Ohio & Kentucky to Pay Nearly $4 Million to Resolve Fraud Allegations”