June 1, 2015 Recent Legal News




Peer Review and Employment



Patients v CareFirst
To Be Filed

CareFirst Blue Cross Blue Shield had a cyberattack and the information on 1.1 million people were hacked.  The insurer covers residents of the eastern seaboard.   The attack occurred in June 2014 and was initially thought to be fended off but alas no.  Those affected will get two years of credit watch.  The FBI is investigating.

Columbia Casualty v Cottage Health Systems

In a fascinating case that will have major ramifications in the health industry, Columbia is suing to to not pay a settlement of a class action against the Santa Barbara hospital for a data breach.  The insurance company says the hospital did not follow adequate procedures and risk controls that were outlined in its insurance application.  They allege that Cottage did not do the reasonable and necessary things a prudent person would do.  The breach resulted in the information of 32,000 people being at risk.  The hospital settled for $4.1 million.  Let us hope the insurer wins.        Top


US v Patel

Vijay Patel of Parsippany, New Jersey, was sentenced to 12 months in prison after pleading guilty to fraud charges.  He is an owner of a cardiology testing facility that employed Dr. SA, a cardiologist.  Dr. SA was on "pre-payment review" from Medicare and Patel billed without the required documentation required.  Patel admitted submitting claims from SA as if they were done by another.

US v Kahn

The Assistant Administrator of Riverside General Hospital in Texas was sentenced to 40 years in prison for his part in the $115 million Medicare fraud scheme.  Mohammad Kahn had previously pled guilty to fraud and doing kickbacks in the partial hospitalization program. He was also required to pay restitution of $31,321,200.  Others are awaiting sentencing.

FTC v Charities
Filed and Settled

The  FTC has filed charges against the Cancer Fund of America, Cancer Support Services, the Children's Cancer Fund of America and the Breast Cancer Society.  The accuse the charities of being a sham and cheating the American public out of $187 million.  Each of the charities was run be either James Reynolds Sr., his ex wife Rose Perkins or his son, James Reynolds, Jr.  They used telemarketing to scam the money.  The charges are civil and not criminal since there are not alot of teeth in the laws.  Perkins and the son agreed to settle.  They will pay minimal amounts if anything based on the ability to pay.

US v Elhorr

Dr. Hicham Elhorr of Dearborn, Michigan, pleaded guilty to fraud.  He owned a house call service and billed for services performed by unlicensed individuals.  He will be sentenced later.

US v Rosin
11th Circuit

Dr. Michael Rosin of Sarasota got a 264 month sentence on fraud charges.  He is appealing due to ineffective use of counsel.  The court of appeal denied his appeal saying that even if the counsel did not seek a plea deal it would have made no difference.  The physician maintained his innocence all the way and would not have agreed to a plea deal if offered.

US v Marshall Medical Center
ED Cal

A whistleblower noted problems in the hospital's Hematology center soon after starting working there.  There were the use of double billing for single use medications and the physicians billing for longer than what they did on a face to face meeting with the patients.  She bought these to the attention of the hospital and the physicians and was promptly fired.  The court ruled that the case should continue.  The hospital attempted to defend because it was a rural hospital but could provide no evidence of same except the state considered it such.  Whether it was or is a rural hospital is a material fact that need to be decided by a jury.

US v Sabit

Dr. Sabit of Detroit pled guilty of two criminal counts of Medicare fraud for performing unnecessary surgery and implanting costly and unnecessary devices.  He admitted scamming $11 million from Medicare.  He also admitted to a kickback scheme with Apex, a bone hardware company in California.  Sentencing at a later date.

Kellogg Brown & Root v US
United States Supreme Court

 This case involved the statute of limitations in fraud cases.  The Court said that the Wartime Suspension of Limitations Act extends statutes of limitations during times of war not civil cases like whistleblower fraud cases.  This allows stronger whistleblower cases to piggy back on weaker ones against healthcare providers.  Suits can be filed against providers as long as there is not a pending case.  Pending does not include cases that have already been decided.  This was an unanimous ruling.

US v Kuthuru

Dr. Mahesh Kuthuru from Utica, New York, was sentenced to 18 months in jail and ordered to pay $84,265 in restitution as well as a $125 special assessment.  This is for fraud in billing as well as unlawfully distributing controlled substances, a misdemeanor.  He was billing for services in Utica while practicing medicine in Las Vegas.  His co conspirator Bonnie Meislin will be sentenced later. 

People v Blue Cross and Blue Shield

There are two separate suits seeking class action against the insurer for antitrust.  The one is from the providers and the other is from the consumers.  They believe that the insurer has conspired using their market power to increase premiums and decrease payments.  The judge has already ruled that the plaintiffs have made their market power argument sufficiently at this stage and will let the case go to deposition.  This case is directed against the licenser of the Blues names, not necessarily the individual Blue Cross or Shield company.  They are licensed to use the name.    

Nolte v Cedar Sinai
Ca Ct App

The trial court dismissed the suit against the hospital for unfair business practices.  The reason for the suit and attempted class action is the failure of the hospital to let patients know that they will be charged a facility fee when they see a physician who is bought and paid for by the hospitals.  The appeals court agreed and went on to somewhat chastise the attorney for not adding a complaint that the hospital did not follow Health and Safety Code 1339.51 which require hospitals to make available either electronically or written a copy of its schedule of charges.   

US v Rinaldi

Psychologist Sharon Rinaldi of Inverness, Illinois, pleaded guilty of Medicare fraud.  She billed for treating dead people (maybe some got better), billing when she wa not in town (again, maybe that was better) and billing for more hours that actually seen (that is not good).  Sentencing later.

US v Orbit Medical

Orbit Medical will pay $7.5 million to settle allegations that they submitted false claims for DME.  The Salt Lake and Indianapolis company had their representatives alter prescriptions to get power chairs paid by the feds.  They changed dates on prescriptions and chart notes so the time would be according to law.  This is a whistleblowing case and the duo will get $1.8 million. 

US v Garden State Cardiovascular Specialists

The medical group and Doctors Jasjit Walia and Preet Randhawa will pay $3.6 million to settle allegations that they billed falsely for tests not medically necessary.  This was another whistleblower suit.  She will get $648,000. 

FTC v Teva

Teva agreed to pay $1.8 Billion to settle claims that it entered deals with other pharmaceutical companies to delay there entry into the business.  The original suit was against Cephalon which was acquired by Teva.     Top


Magnini v Centegro Health
Ill App Ct

I hope the attorney lost money on filing the stupid claim.  The patient claimed to be injured during a gastric bypass surgery.  The attorney sued the hospital when it was known that the physicians were independent contractors.  The attorney even appealed the dismissal of the suit after the loss in the trial court.  There was not any control over the physicians to allow vicarious liability.

LaTourette v US

Past Representative Steve LaTourette of Ohio is suing the feds for malpractice.  They did not tell him of a mass in his pancreas prior to his developing overt pancreatic cancer.  The radiologist found the mass but his physician never followed up or told the Representative about it.  Flat out malpractice.    

Barba v Boston Scientific
Trial Court

The court ordered Boston Scientific to pay the plaintiff $100 million in a law suit over vaginal mesh.  The Delaware jury gave the plaintiff $25 million in compensatory damages and an additional $75 million in punis.  This will be appealed and changed.  The mesh was placed for prolapse and urinary incontinence.  She needed several surgeries to remove the device and part is still in place.  This is the sixth verdict against the company on the device.  The cause of action is poor design and failure to warn.  There are about 100,000 cases lined up against the manufacturers of the devices.     Top

Peer Review and Employment

Idstrom v Alliance Radiology of Kansas City
Trial Court

Dr. Mark Idstrom sued his radiology group for antitrust, breach of fiduciary duty and civil conspiracy.  The antitrust portion was dismissed and the judge awarded Idstrom $1 on the breach of fiduciary duty claim and $719,000 on the civil conspiracy claim.  The group will appeal.

Hamby v Health Management Assoc
Ark Ct App

Dr. Hamby sued his employer after he was terminated from his position.  He was an ER physician who stated that the health system pressured his employer to terminate his position.  In trial court he alleged that the health system engaged in a scheme to increase profits by pressuring the physicians to admit patients to the hospital who did not need to be admitted.  The lower court dismissed his claim but the court of appeal reinstated it stating the facts alleged were enough at this state of the proceedings.         Top


Idaho v Lieteau

Valarie Lieteau, RN was arrested in Southern California on a drunk driving charge and was found to be wanted in Idaho for four felony counts of sexual misconduct.  She has been accused of having sex with juveniles at the Idaho juvenile facility in Nampa.  

FamilyCare, Inc v Oregon 

This could be a quick case since the Supreme Court ruled that providers could not sue the states for reduced payments.  That's what this case is about.  They will be suing for bad faith and fair dealing .  The other claim is for negligence arising out of not doing actuarial sound rates.  

Minnesota v Final Exit 

Minnesota is a state that does not allow assisted suicide.  A jury has decreed that Final Exit was guilty of assisting in the death of Doreen Dunn in 2007.  Sentencing will be later.  She died of helium asphyxiation while several member of the group were present in the home.  Dunn was not terminally ill but had chronic pain.  No individuals of the Final Exit that were in the home were present at the trial. The verdict will be appealed. 

Braydon O v Nebraska Medicaid
Nebraska Supreme Court

Braydon O is a handicapped child who was on the Medicaid administered Home and Community Based Waivers Program.  This helped provide care at home so the mother could work.  After 12 years the program ceased giving Braydon benefits and a suit ensued.  The mother lost in the lower court but the Supreme court reversed since the Department cherry picked the exhibits at the lower court.  

Texas v King

Terrance King was arrested for impersonating a physician.  He made it into the Children's Hospital Dallas and when found out stole an ambulance to flee.  He was arrested two years ago for posing as a firefighter.  The hospital said it will strengthen its procedures and protocols, of course after the incident not before.      Top


DISCLAIMER: Although this article is updated periodically, it reflects the author's point of view at the time of publication. Nothing in this article constitutes legal advice. Readers should consult with their own legal counsel before acting on any of the information presented.