September 1, 2016 Recent Legal News


Peer Review and Employment






Kentucky v Tri-State Family Medical Center

Dr. Alfred Baldera, Kevin Gauze and Janice Gauze were indicted on Medicaid Fraud.  Baldera is indicted for Medicaid Fraud, forgery of a prescription and unlawful prescribing.  The other two are indicted for fraud and controlled substance violations.  The Center faces a fine of $20,000.  They are accused of billing for items not received 

SEC v Health Net

The insurer agreed to pay the SEC $340,000 to settle allegations that they used illegal severance agreements to keep departing employees from whistle blowing.  They must also send notices to all who signed the agreements to tell them that it is OK to be whistleblowers.  

US v Scappa

Fort Meyer Urologist Robert Scappa has agreed to pay the feds %250,000 to settle allegations that he billed for unnecessary lab tests.  He was a member of 21st Century Oncology and ordered FISH tests that were not needed for bladder cancer.  He ordered these tests at a 21st Century lab and was paid bonuses by the company based in part on the number of FISH tests he ordered.  This was a whistleblower case which has netted the former medical assistant a cool $3.2 million.  She worked for another 21st Century urologist Dr. David Spellberg.

US v Verdel

Dr. Clarence Verdell of Voorhees, New Jersey, and Rochelle Williams-Morrrow were indicted for conspiracy to distribute controlled substances and fraud.  The indictment says Verdell worked for Dr. Alan Summers who was recently indicted for illegally selling prescriptions for cash.  Verdell attempted to get Summers' patients and prescribe Suboxone without an examination.  He is also accused of giving prescription pads to his office manager to customers when he wasn't present.  

Azomani v State
Miss Ct App

The physician used an incorrect CPT code to bill Medicaid in 125 children.  The State investigated and found the improperly billed services and he was found guilty of Medicaid fraud.  He appealed stating there was no proof of him willfully unlawfully and feloniously filed fraudulent claims.  The court focused on the program director who said the physician is responsible and so the conviction stands.

Hospitals v CMS 

CMS has released the names of the hospitals who have been paid in a compromise to settle a backlog of disputes over what hospital say they are owed versus what the fed actually paid them.  The hospital that got the most was NewYork Presby.  They got $16 million.  Thirty five hospitals got over $5 million.  The feds are paying 68% of the value of the inpatient claims that are in review due to RAC claims that are being disputed.    Remember the RAC gets paid for reporting the error even if the hospitals eventually successfully refute the claim. 

US v Huang

 Dr. Boyao Huang of Pasadena was sentenced to 4 years for fraud for falsely certifying people were dying so they could get illegal hospice care.  Another physician Dr. Sri Wijegoonaratna has also been convicted in this case and will be sentenced later.  Huang must also pay $1.3 million in restitution.

US v Madison County Community Health Center

The hospital agreed to pay $190,000 to settle claims from a physician on staff that it has become a pill mill hospital.  In a raid the feds found prescription pads pre-signed by the medical director.  

US v Mt. Sinai

The Mt. Sinai system will pay the feds almost $3 million to settle a whistleblower suit alleging they held on to overpayments by the fed for too long.  There is a 60 day repayment window and the system did not repay an overpayment of $844,000.  Poor thought processes by the hospital.  This may lead to hospitals being responsible for overpayments going back 16 years.

Goldman v Barrett

The AP reports that Dr. Robert Goldman and Ronald Klatz sued Dr. Stephen Barrett and his Quackwatch website for $10 million.  The site reported that the two physicians agreed to pay $5000 to Illinois and stop identifying themselves as Illinois physicians unless they become licensed by the state.  The website did not update after in 2006 the Illinois Department said the two have been licensed DOs for over 20 years.  The two are co-founders of the American Academy of Anti-Aging Medicine.  The judge tossed the suit as the two did not made a plausible claim for defamation by implication.  

Debrorah Heart Center v Virtua Health
3rd Circuit

Debrorah filed suit against the system and physicians for not getting referrals.  They used to have a relationship with the hospital but the hospital made an exclusive contract with the cardiologists that used to go to Debroah.   The court said the plaintiff lost the antitrust case on the market definition.  

US v Balko

Dr. John Balko of Mercer County, Pennsylvania, has agreed to pay the feds $930,000 to settle claims that he made charges to nursing home patients which were not medically necessary, not supported by the record or provided in reliance of improper standing orders.

US v Villegas

Jesus Villegas, DDS. of West Haven, Conn. has agreed to pay $1.3 million to settle allegations that he and his pediatric dentistry office had the majority of the x-ray done in the office by uncertified dental assistants.  

Canada v Chandra

Canada ha filed healthcare fraud charges against Ranjit Chandra, a nutritionalist who practices as an allergist.  He is accused of billing for services not provided or billed inappropriately. He is believed to be living in India.  Good luck.

US v Oparah

Drs. Sonny Oparah and Edward Ridgill of SoCal were arrested for allegedly writing false prescriptions for gang members.  The gang purchased the false prescriptions with the use of proceeds from home burglaries.  The gang, the Crips, then resold the drugs on the street.  Oparah is accused of writing 13,000 illegal prescriptions and Ridgill 21,000.  Their bank accounts have been seized.

US v Neurology Associates of Greenville, P.A.

The practice pled guilty and agreed to pay $300,000 for using misbranded drugs.  They are on 3 years of probation.  The practice used non-approved Botox from an unapproved factory in Ireland.          Top

Peer Review and Employment

WLB Radiology v Mercy Health
Ohio Ct App

The two were in contract and after some months he was terminated without cause.  There was a 90 day clause and the system paid him for the average he made in the past for the 90 days and let him go immediately.  He sued for more money under breach of contract.  He sad they stopped paying him for reading CT Scans and overtime.  The court found that the agreement stated that he was to read CTs only on request of the system and he did not submit the required documentation required.  He also made the joke reasoning that the termination did not let him follow up his patients but (1) a radiologist has no patients to follow and (2) he did not identify any patients.

Walden v Missouri River Medical Center

Walden is a former infection control coordinator who was fired after she reported violation of policy.  She was fired after sending an email to her supervisor, the CNO, correcting her on information regarding an epidemic of scabes at the institution.  In March, 2015, there was an outbreak of scabes.  She recommended all be treated as recommended by the CDC.  The center ignored her recommendations and the outbreak grew.  It was investigated by the state HHS during which time Walden said the CNO was concerned regarding cost and not treatment.  A month later Walden contacted OSHA who visited the institution.  A month later she contacted OSHA again and there was another visit.  A month later she sent an email to correct the CNO statements.  I hope the institution loses big as I was the Medical Director when a hospital had such an outbreak and we did the right thing.

 Cuellar v SW General Emergency Physicians
5th Circuit

A NP employee of the physician group was terminated after filing a claim for sexual harassment.  She reported that her supervisor promised to spank her if she misbehaved.  The lower court ruled for the summary dismissal of the suit.  The 5th Circuit overruled the lower court in the retaliation claim not the sexual harassment claim.

Fallon v Mercy Catholic Med Ctr of SE Pa.

The employee was terminated for not obtaining a vaccination nor providing the hospital with a letter on official clergy letterhead supporting his request for an exemption.  He had stated he belonged to no official religious organization and his reasoning was his conscience.  He sued for religious discrimination.  The court ruled that the employee failed to state a claim for religious discrimination since his mindset was personal and not spiritual.

Harris v Community Hospital of Long Beach 
LA Superior Ct.

Three former employees sued the hospital for sexual harassment by a gay male nurse.  The hospital was found guilty of harassment, discrimination and failure to prevent harassment and discrimination.  The compensatory damages were a total of almost $3 million and punitive damages of $1.9 million.  The punis were doe to being found guilty of malice or oppression.  The hospital attempted to plead that if they awarded monetary damages they could not afford to continue to treat the Compton residents.  

Peterson v Fergus

Dr. Philip Peterson was terminated from Bluefield Hospital and the CEO Fergus reported that he was terminated for bad acts.  He is suing for damages for false statements to the West Virginia Medical Board and the Virginia Department of Health Professionals stating he had failed to maintain medical records and prescription data in an appropriate manner and also they falsely reported to the police he was dangerous and in possession of numerous firearms.          Top


Patients v Valley Anesthesiology and Pain Consultants
To Be Filed

The organization may have been hacked by a third party.  Since they could not rule it out they have notified almost 900,000 patients and employees that their information may have been compromised.

Patients v Bon Secours Health System and R-C Healthcare
To Be Filed

The system vendor made information available on the internet for four days.  

Patients v Outer Banks Hospital
To Be Filed

The hospital lost two flash drives with patient information and notified an unknown number of patients that their identity was compromised. 

Attias v CareFirst 

The plaintiffs wanted a class action status for the breach of HIPAA by CareFirst in 2014 where a hack put the information of over one million at risk.  The court said that the increased risk of identity theft is not sufficient to establish injury in fact.  It is too speculative.  

Patients v Highmark
To Be Filed

About 150,000 Highmark Delaware Medicaid patients had their information potentially compromised by a cyberattact on a supplier Newark.   

Patients v Orleans Medical Clinic
To Be Filed

Orleans Medical Clinic of southern Indiana had its servers hacked.  There were 6890 records involved.

Patients v USC 
To Be Filed

Over 700 patient's records were compromised after a car break in that got the files.  Why were the files in the car?  Negligence.

Patients v SCAN
To Be Filed

 SCAN health Plan had the records of 87,000 patients compromised in a cyber attack and did not know it for months.        Top


Rush University v NLRB
DC Ct App

All one needs is the name of the court and the name of the defendant to know how they ruled.  The Democratic controlled court routinely rules for the Democratic NLRB.  This case involved whether an incumbent union could organized only a portion of the employees or whether they need to organize all.  The court stated that the addition of employee to an existing unit did not have to meet the same requirements that would apply if a union was seeking to organize employees into a new bargaining unit in an acute care hospital.

Marijuana Clinics v US
9th Circuit

The 10 marijuana clinics sued the feds to stop the federal drug charges against dispensaries and growers in California and Washington.  The Court told the DOJ to stop harassing the people who are following the laws of the state.  There is a Rohrabacher-Farr rule that prevents the feds from using funds to prevent states form making their own laws on Marijuana.  The DOJ interpreted the law to their own liking which would allow them to prosecute.  The judge in the lower court and the 9th skewered the DOJ with readings out of Merriam-Webster.

Krupa  v Badolato

The Krupas, two lesbians, wanted to get insurance for infertility and were denied.  Eventually the insurer gave coverage but it has cost $25,000 to date.  They have sued the stated Banking and Insurance Commissioner to allow coverage for women who do not meet the current definition of infertility, failure to conceive after two years of unprotected sex for women younger than 35 and one year for those over 35.  

Personal Physician Care v Florida Physicians Trust
MD Fla

The plaintiff physicians participated from 2012 to 2014 in an ACO run by the defendants.  The last year the ACO received a Earned Shared Savings payment of over $2 million for the year.  The plaintiffs contend the defendants did not share the Shared savings.  They are suing for a bunch of breaches.  The defendant removed the case to federal court and the court remanded it back to the states since the claims were state claims.  This was done to string the case out as they had to know there was no basis for a federal claim. 

Omni Healthcare v Health First

The physician organization and others sued the health system for antitrust violations.  They alleged the system pressured them to refer exclusively and those who didn't were dropped from the Health First insurance panel and medical staffs.  They also argued that Health First held market power.  They wanted Health First to unwind its medical acquisition, divest its health plans and pay $350 million in damages.  Health First said that the plaintiffs lacked proof and that this was the disgruntled cries of fee for service doctors.  Then on the second day of trial they folded and settled to unknown terms but covered all the plaintiff claims.  

Sisters of Charity v Palmetto Health System

The plaintiffs sued the defendants for stealing Moore Orthopedic from Providence Hospital.  The suit is for the value of the practice $590 million plus other damages.  These are the two major systems in Columbia, South Carolina. 

New Jersey Cities v Hospitals

The cities of New Jersey are after more money and they have found the patsies, their hospitals.  The hospitals are all non-profit but do not act as such and therefore are subject to local taxes.  The governor stopped the litigations to give time for settlements.  These are taking place with 35 hospitals to date. 

Texas v US

Texas and other states are suing the feds for their extending healthcare nondiscrimination to transgender individuals.  The argue that medical groups would be forced to violate religious beliefs to perform transgender procedures.   This follows a judge blocking nationally the Obama "bathroom law". 

Life Legal Defense Foundation v California
Ca Superior Ct.

 A California superior court judge ruled that the state's Right To Die Law would not be immediately suspended.  He id allow the case to be pursued for the claims that the law lacks safeguards.  

Parents v California

A federal judge refused to block the California law that requires all children to be immunized prior to school.  They wanted but did not get an injunction.  The case will still be in the courts but not heard for several years. 

U. Minnesota v Gilead

The University of Minnesota believes that they have the patent on Gilead's blockbuster drugs Sovaldi and Harvoni for Hepatitis. This follows a suit by Merck over the drugs.  Merck originally won that suit but eventually that was reversed.

Patients v Bristol-Meyers Squibb
California Supreme Court

Nothing like a good Democratic leaning Supreme Court.  They ruled in a 4-3 decision that it is OK for the suits against the company for harm due to Plavix to be all in the consumer friendly California courts no matter where the patient is located.  The court ruled that the company did enough business in the state to sued only in tort friendly California.  This may and probably will allow many other suits to be heard here that should be in the state court of the plaintiff.   Top


Humboldt General Hospital v Sixth Judicial Dist
Nevada Supreme Court

Plaintiff Barrett had an IUD implanted which was not FDA approved.  She filed suit which included battery.  She had no expert for the battery claim and the district court refused to dismiss the claim.  The Supreme Court ruled the claim was actually a malpractice claim that needed an expert and the claim should have been dismissed.  The plaintiff did not allege she failed to consent to the procedure itself.

Stinson v Children's LA
To Be Filed

Toddler Israel Stinson was hospitalized in April with Asthma with brain death.  The family has been attempting to keep him on life support.  He was transferred to a hospital in Guatemala and then to LA Children's which got legal authority by an appellate judge to remove the ventilator.  The father wants to file a med mal case.        Top


US v Kuchipudi

The "king of nursing homes", Dr. Venkateswara Kuchipudi of Chicago was sentenced to two years in prison and is to pay over $786,000 in forfeited funds and fines.  He was convicted of conspiracy to defraud and getting benefits for referrals.  He sent patients from nursing homes to the now defunct Sacred Heart Hospital in return for kickbacks.  He is the fifth physician to be convicted in this scheme.  He was also accused of performing tracheotomies on patients that did not need them.  That could not be proven and was not brought up at trial. 

Colorado v Fernandez

 Carlos Hernandez Fernandez was arrested in Denver for impersonating a physician.  He is not a physician but said he was a plastic surgeon and had his own clinic.  He did nose jobs as well as tummy tucks etc.          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.