Feds indict former Georgia-based Tenet exec in kickback case

A former Tenet Healthcare executive was indicted last week on criminal charges for his role in a high-profile kickback case involving North Fulton Hospital and Atlanta Medical Center.

John Holland, a former CEO at North Fulton Hospital who later oversaw operations for Tenet hospitals in Georgia and South Carolina, was accused of fraud for allegedly arranging for Tenet to pay kickbacks in exchange for patient referrals.

Credit: Carrie Teegardin

Credit: Carrie Teegardin

The criminal charges, filed in U.S. District Court in the Southern District of Florida, follow a major corporate settlement last year in the same kickback case. In October, Tenet and two its subsidiaries — Atlanta Medical Center Inc. and North Fulton Medical Center Inc.  — agreed to pay over $513 million to resolve criminal charges and a civil case that accused the hospitals of paying kickbacks to get patient referrals.

Atlanta Medical Center and North Fulton Hospital are now owned by WellStar Health System. WellStar bought the hospitals after the federal investigation began and is not implicated in the case in any way.

The new indictment accuses Holland individually for his alleged role.

Attorney Richard H. Deane, who is representing Holland, said the charges should not have been filed.

“We don't believe there is any case here and the company's resolution should have ended the matter," said Deane, a former U.S. Attorney in Atlanta, in a statement to the AJC.

"The allegations relate to contracts from more than 10 years ago that were openly reviewed and approved at multiple levels of the company, including by their lawyers, under circumstances in which there was no personal benefit or gain to Mr. Holland," said Deane, an attorney at Jones Day. "In light of this, we are disappointed that the government has chosen to go forward with these charges.  Mr. Holland is not guilty and we now look forward to presenting this case to a jury.”

The case resolves around the relationship between the Tenet hospitals and Clinica de la Mama, which operated medical clinics in Georgia and South Carolina that primarily served undocumented Hispanic women. The kickbacks were paid in exchange for referring patients to the hospitals for labor and delivery services that were paid for by Medicaid, according to the indictment.

Credit: Carrie Teegardin

Credit: Carrie Teegardin

In exchange for the patient referrals, the indictment says, Holland and others paid Clinica for various services that were either not needed, already being provided, substandard or not rendered at all.

The indictment says Holland and co-conspirators, who are not named, hid the nature of Tenet's relationship with Clinica de la Mama by falsifying records and reports.

Pregnant woman were told that Medicaid would only cover the costs of delivering their babies if they went to a Tenet hospital, according to the charges. "As a result of these false and misleading statements and representations, along with others, many expectant mothers traveled long distances from their homes to deliver at the Tenet Hospitals, placing their health and safety, and that of their newborn babies, at risk."