[Narrator] Federal health care programs rely on honest doctors, nurses and other providers.

But what happens when providers pay for referrals, or get kickbacks.

Let's look at the case of like Dr. Jack Baker, a Houston radiologist and imaging center owner,

who settled with the government.

He admitted no wrongdoing.

[DeConti] In the Federal health care programs, paying physicians for their referrals, is

illegal.

And the government, in that case, alleged that Dr. Baker paid a number of area physicians,

sham medical director fees, in exchange for them to refer their patients to Dr. Baker's

imaging center.

So the government ultimately pursued Dr. Baker, and settled the case for $650,000.

And Dr. Baker, and his imaging center, agreed to be excluded from participation in Medicare

and all federal health care programs, for a period of six years.

[Narrator] Kickbacks in health care are a big problem.

They can lead to higher costs for patients, unnecessary tests, and doctors making decisions

based on making money, versus caring for patients.

[DeConti] When I'm going to the doctor, I want to know that the physician is sending

me somewhere based upon my best interests as the patient, not because the doctor is

receiving an illegal payment.

[Narrator] OIG didn't stop with Dr. Baker's settlement.

It settled with the 12 physicians who allegedly got kickbacks from Dr. Baker, which resulted

in a total settlement of $1.4 million dollars.

The 12 physicians also admitted no wrongdoing

[DeConti]OIG pursued all 12 of the physicians who received kickbacks as part of the sham

medical director agreements, under what's called the civil money penalties law.

And that law is a law that Congress passed, that allows HHS, to pursue individuals and

entities for penalties separate from any criminal or civil case.

[Narrator] OIG wanted to send a clear message to physicians about the importance of this

case.

It published a fraud alert on the OIG website, and spread it throughout the health care community.

[DeConti] I think these cases are significant because for a long time the government has

focused on the provider that pays the kickbacks, often times the corporate payor of the kickback,

and these cases involve the individual physicians who received the kickbacks.

And that's important for physicians to know, that if they're approached by a provider,

that offers to pay them money, in exchange for not doing any work, they should stop and

think, is that really a relationship that they really want to enter into.

I would encourage physicians to look at all the compliance materials we have on our website,

so that they don't find themselves in a situation like some of the physicians in these cases.