The podcast drew on recent enforcement activity, including a DOJ intervention against an unnamed Tennessee health system and prior settlements in cases involving Tuomey and a Florida hospital. Katz addressed how private equity involvement in healthcare has intensified these risks, particularly around the concept of "leakage"—lost referrals when physicians leave a health system. The specific details of the Tennessee case and its resolution remain undisclosed.
Healthcare executives and their counsel should note the DOJ's active enforcement posture on physician compensation. The episode underscores that compensation discussions must focus on legitimate business justifications—capacity, efficiency, market rates—rather than referral volume or benefit. Structuring these arrangements with documented legal review and avoiding any nexus between payment and referral patterns are now essential defensive measures. Attorneys advising on physician employment or acquisition deals should treat FCA and Stark Law compliance as non-negotiable elements of deal structure, not afterthoughts.