Baptist Health System will pay $1.5 million to settle allegations involving discounts offered to some Medicare beneficiaries.

The health system, based in Jacksonville, led its subsidiaries to offer discounts to patients to induce them to buy services reimbursed by federal health care programs or for referrals to those services, according to the U.S. Attorney’s Office.

Prosecutors alleged that Baptist Health subsidiaries provided discounts of up to 50% or more on patient cost-sharing obligations for certain categories of Medicare beneficiaries from Jan. 1, 2016, through Aug. 15, 2022. 

The actions violated the False Claims Act, prosecutors said.

The Justice Department said Baptist reported the potential violations to the federal government in 2022, then stopped the discount policies.

“Baptist Health cooperated with the government’s investigation and took remedial measures, including discontinuing its discount policy, conducting an internal compliance review and providing the United States with a detailed disclosure statement and other supplemental information to assist the United States in its investigation,” the U.S. attorney said in a news release.

The settlement is not an “admission of liability” by the hospital system, the news release said.

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In a statement Monday evening, Baptist said it voluntarily reported “outdated courtesy discount practices.”

“The self-disclosure process encourages transparency and facilitates the resolution of matters that potentially violate federal laws, and it aligns with our commitment to do the right thing,” the statement said. “This settlement reaffirms our dedication to compliantly delivering high-quality care.”

This story was updated May 7, 2024, with a statement from Baptist Health.