Modern Nuclear Inc. (MNI), a La Habra, California-based mobile PET scan provider, agreed to pay $8,334,350.71, plus additional amounts tied to future revenues, to resolve False Claims Act allegations brought by the Department of Justice [1]. The settlement resolves claims that MNI paid referring cardiologists fees exceeding fair market value in exchange for patient referrals, conduct the government characterized as unlawful kickbacks under the Anti-Kickback Statute [1].
The Anti-Kickback Statute prohibits offering or paying remuneration to induce referrals of services covered by federal health care programs, including Medicare [1]. The DOJ alleged that MNI's conduct spanned from September 2016 through January 2025, a period of roughly eight years during which the company contracted with cardiology practices to supervise mobile PET scans at rates the government contends were above what the market would support [1]. Because MNI then billed Medicare for those scans, the allegedly tainted referrals rendered those claims false under the False Claims Act [1]. The Defense Criminal Investigative Service and the U.S. Attorney's Office for the Central District of California participated in the investigation [1].
The case originated as a qui tam action, meaning a private relator filed suit on the government's behalf under the False Claims Act's whistleblower provisions, which permit individuals with inside knowledge of fraud to share in any recovery [1]. In addition to the financial settlement, MNI entered into a five-year Corporate Integrity Agreement with the Department of Health and Human Services Office of Inspector General, requiring ongoing compliance monitoring, internal audits, and reporting obligations [1]. Corporate integrity agreements of this kind function as a structural condition on continued participation in federal health programs, and breach can trigger exclusion from Medicare and Medicaid.
The settlement does not constitute an admission of liability by MNI [1]. The revenue-based component of the payment, layered on top of the fixed sum, reflects a structure the DOJ has increasingly deployed in healthcare fraud resolutions to account for uncertainty about a defendant's future financial condition. MNI's continued operation under HHS-OIG oversight means the government retains a direct compliance window into the company for the next five years. No charges were filed, and the matter closes at the civil settlement stage barring new allegations.
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