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DOJ: Sanford to pay $20M to settle kickback allegations

SIOUX FALLS, S.D. — The U.S. Department of Justice says Sanford Health has agreed to pay more than $20 million to resolve kickback allegations.

The DOJ said Monday the settlement resolves allegations that the Sioux Falls, South Dakota-based health system knowingly submitted false claims to federal health care programs resulting from medically unnecessary spinal surgeries.

The settlement resolves allegations that Sanford knew that one of its top neurosurgeons was improperly receiving kickbacks from his use of implantable devices distributed by his physician-owned distributorship.

Sanford chief operating officer Matt Hocks says the health system denies any liability or wrongdoing. Hocks says Sanford settled because the $20.25 million amount is “far less than the unnecessary costs and operational disruption that would have persisted for multiple years.”

The allegations came in a whistleblower lawsuit filed by two Sanford doctors.

The Associated Press