UPDATE: New York Catholic health system to pay $3.3 million over alleged Medicare claim violations

Catholic Health building in Buffalo, New York. / Credit: Andre Carrotflower, CC BY-SA 4.0, via Wikimedia Commons

CNA Staff, May 21, 2025 / 14:01 pm (CNA).

A Catholic health care system in New York state has agreed to pay a multimillion-dollar settlement over allegations that it violated federal Medicare reporting laws. 

The U.S. attorney’s office for the western district of New York said in a press release that Catholic Health Systems agreed to pay nearly $3.3 million in order to resolve allegations that the network “knowingly submitted or caused to be submitted false claims to the Medicare program” in violation of federal law. 

The government had alleged that the Catholic hospital system violated the Stark Law, a federal rule that prohibits health care entities from receiving Medicare payments for services referred by a physician with “a financial relationship to the health care entity.”

The prosecutor’s office claimed that the Catholic health provider “had financial relationships with nonemployee physicians” who “referred health services, such as laboratory testing, hospital services, or medical supplies, to CHS and its affiliated hospitals.”

“The Stark Law is designed to protect Medicare by ensuring that physician referrals are not influenced by financial interest,” U.S. Attorney Michael DiGiacomo said in the press release, stating that his office “is committed to holding health care providers accountable who engage in such conduct.”

Though the Catholic medical system will pay more than $3 million over the claims, the payout does not establish the guilt of the hospital, the government said. 

“The claims resolved by the settlement are allegations only and there has been no determination of liability,” the press release stated. 

Federal authorities were originally tipped off to the alleged violations by Gary Tucker, a former executive in the Catholic Health Systems network. Under whistleblower provisions, Tucker “will receive a share of the settlement,” the government said. 

In a statement provided to CNA, Leonardo Sette-Camara, the general counsel of the hospital system, said: “Defending these types of subjective allegations requires an unsustainable and unacceptable allocation of Catholic Health resources.”

“This investigation was never about the quality of care provided to our patients. By resolving the case now, we can move forward and remain fully focused on delivering the highest standard of care,” he said.

This report was updated on Wednesday, May 21, 2025 at 3:00 p.m. with a statement from the hospital.