CAMDEN, NJ (CBS) — Executive Assistant Attorney General John Hoffman and U.S. Attorney Paul Fishman announced Thursday that Camden’s Cooper Health System has agreed to a $12.6 million settlement resolving allegations the hospital entered into improper consulting and compensation agreements with physicians while building its cardiology program.

According to the settlement, Cooper must pay the federal government approximately $10.2 million and the State of New Jersey $2.3 million. Cooper has also agreed to a number of reforms aimed at enhancing accountability, training and other aspects of its operations.

The settlement agreed on resolves a joint federal-state investigation into financial relationships involving the Cooper Heart Institute, its Advisory Board and the doctors who served on that board. The investigation alleged that Cooper engaged in a practice whereby physicians who were members of the Advisory Board were being paid for advice but, in reality, were being paid to refer their patients to Cooper’s Heart Institute for treatment.

The investigation also revealed that Cooper sought and received reimbursement through Medicare/Medicaid for treating those inappropriately referred patients, which is in violation of state and federal law.

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