The U.S. Department of Justice (DOJ) recently reached a $1 million settlement with Ralph J. Cox III, the former CEO for Tuomey Health System, Inc. (Tuomey), in connection with his involvement in the notable Stark Law case. After protracted litigation, Tuomey agreed to pay $72.4 million in October 2015 to settle allegations that the system had violated the Stark Law. The government alleged that Cox, in hopes of addressing local competition from a new freestanding surgery center, caused Tuomey to enter into illegal compensation agreements with 19 physician specialists. Emphasizing that “the Justice Department and its law enforcement partners will hold individual decision makers accountable for their involvement in causing the companies and facilities they run to engage in unlawful activities,” the Cox settlement is significant given the high level positions Cox held as both CEO and board member.
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