Imaging centers agree to $1.2 million settlement in MRI antikickback suit

January 15, 2009

Illinois Attorney General Lisa Madigan has reached a $1.2 million settlement with a group of 14 Illinois radiology centers that allegedly paid illegal kickbacks to doctors in exchange for referrals.

Illinois Attorney General Lisa Madigan has reached a $1.2 million settlement with a group of 14 Illinois radiology centers that allegedly paid illegal kickbacks to doctors in exchange for referrals.

The settlement, entered in court on Wednesday, resulted from a lawsuit brought by the attorney general in 2007 after Chicago-area outpatient MRI services challenged the practice of referring physicians leasing MRI scanners.

The settlement requires the defendants to stop paying the illegal kickbacks associated with the leasing practices and to pay damages, restitution, and penalties.

Under the settlement, MIDI, LLC, and 14 Open Advanced MRI centers will pay a total of $1.2 million to settle the state's lawsuit. The state's share of $840,000 will be distributed in grants to benefit low-income persons in need of healthcare services. The settlement also explicitly prohibits the radiology centers from operating under any kickback agreements with referring physicians in Illinois.

"When patients are referred to MRI facilities, they should be able to feel confident that the referrals were made for medical reasons only," Madigan said in a news release. "This settlement sends a strong message that medical professionals cannot engage in schemes to line their pockets at the expense of providing the best patient care."

In 2007, Attorney General Madigan intervened in a lawsuit against various radiology centers and then filed an amended complaint against the centers. The lawsuit alleged that the radiology centers entered into sham "lease" agreements with doctors under which they paid one rate for MRI and CT scans, charged the patient's insurance carriers a higher rate, and pocketed the difference. The lawsuit asserted that the defendants' actions violated the Consumer Fraud and Deceptive Business Practices Act, as well as Illinois's antikickback law, the Insurance Claims Fraud Prevention Act.

The 14 Open Advanced MRI centers involved in this settlement, all in Illinois, are:

  • Open Advanced MRI of Chicago (150 N. Michigan Ave)
  • Open Advanced MRI of Tinley Park
  • Open Advanced MRI of Crystal Lake
  • Open Advanced MRI of Round Lake
  • Open Advanced MRI of Plainfield
  • Open Advanced MRI of Lincoln Park (1355 W. Fullerton Ave., Chicago)
  • Open Advanced MRI of Deer Park
  • Open Advanced MRI of Skokie
  • Gold Coast MRI at Washington Square (Chicago) (facility is now closed)
  • Open Advanced MRI of the North Shore (Skokie) (facility is now closed)
  • Open Advanced MRI of Oak Brook (Westmont)
  • Open Advanced MRI of Schaumburg
  • Advanced Imaging of Deerfield (facility is now closed)
  • Open Advanced MRI of Wheaton

In addition to the MIDI settlement, Madigan has settled with five other imaging companies.