- Associated Press - Wednesday, January 21, 2015

BOSTON (AP) - An administrative arm of South Shore Hospital will pay nearly $1.8 million to settle allegations that it was running an illegal kickback scheme by paying doctors to refer patients to services within the hospital’s health care network.

The state attorney general’s office says the kickbacks included 103 payouts to 33 physician groups over nine years ending in 2010. They continued despite attorneys within the organization raising concerns.

South Shore Physician Hospital Organization, which does contracting and administrative work for South Shore Hospital and affiliated doctors, denied wrongdoing in settling the case. The nonprofit said it self-reported the scheme.

Authorities said the arrangement deceived patients and limited their choices, raising costs for patients and insurers.

The settlement includes penalties of $1.15 million to the federal government and $620,000 to the state.

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