January 15, 2017 Recent Legal News




Peer Review and Employment



US v Simmons

Twelve physicians, marketing people and pharmacist owners have been indicted by the feds for health care fraud.  They are accused of scamming Tricare by prescribing "compounded" drugs and getting kickbacks.  The indictment claims that Dr. Walter Simmons, an ED physician, colluded with CMGRX, a marketing company in Dallas to write these prescriptions to be filled in four pharmacies.  The indictment says that the marketing group created a sham medical study to make this happen.

US v Family Care Visiting Nurse 

A Stratford, Conn., home health agency has agreed to pay $5.25 million to settle charges of fraud.  They did not use RNs for the visits as required for the billings.  

US v Cardinal Health

The company agreed to pay a fine of $44 million to resolve allegations it failed to tell the DEA about problems by pharmacies in three states.  

US v Conte

Another doctor, Salvatore Conte of Totowa, New Jersey was indicted for accepting bribes from the infamous Biodiagnostics Laboratory Services.  This makes the fifth physician so charged.  There have been 41 total guilty pleas, 21 from physicians.

US v Shire Pharmaceuticals

The company has agreed to apy $350 million to settle allegations of giving kickbacks to induce the use of "Dermagraft".  The company gave lavish dinners to physicians to induce them to use the product.  This was a whistleblower case but the shares have not yet been determined.

Consumer Financial Protection Bureau v Works and Lentz

The law firm of Works and Lentz in Tulsa has been ordered to repay $577,135 to consumers and and pay an additional $78,000 penalty for illegal business activities.  They sent letters for medical collection intimating they came from attorneys when no attorney had reviewed the billing.  The attorneys made no admission of guilt.

US v Sabit

 Dr. Aria Sabit of Birmingham, Michigan, was guilty of four counts of fraud .  The neurosurgeon did surgeries that were not necessary in order to use and profit from instrumentation when none was used.  He was involved with Apex Medical and convinced hospitals to purchase the implants.  He was sentenced to 235 months in jail.


Aetna v Humble Surgical Hospital
SD Texas

Aetna sued and won a $41.4 million judgment against HSH, a five bed surgical hospital for violation of federal anti-kickback laws.  The judge said the hospital gamed the system to get Aetna to pay inflated claims.  A similar suit months prior by Cigna against HSH in which Cigna not only lost but was told to pay the hospital an additional $13.6 million.

Texas v US
ND Texas

The judge ruled against the Obama administration's and agreed to a temporary injunction stopping a regulation that would prevent discrimination on the basis of gender identity and termination of pregnancy in health care.  He ruled there was a lack of a basis for its definition of gender identity.  

Federal Judge

A federal judge refused to delay or reconsider the order to HHS to eliminate within four years the huge backlog of hospital appeals regarding payment.  The feds said the order would force them to pay claims regardless of merit.  This is the same claim as they made prior so was no reason for a reconsideration.

Figueroa v Molina Health

Dr. Manuel figueroa of the Associated Hispanic Physicians of Southern California sued the organization for class action status for not paying him higher payments under Ocare for 2012 and 2014.  The company denies any wrongdoing but has been the brunt of criticism from other Hispanic physician groups for underpayments.

US Renal Care v US
Texas DC

 Another Texas judge has blocked another federal law.  This law prohibited the dialysis companies from paying insurance premiums for their patients to get on Ocare instead of Medicaid.  The companies would then get a higher reimbursement.  The judge issued a TRO against the law going forward until the merits of the case were heard.   


Patients v Johnson and Johnson
USDC Texas

The judge kept the jury finding that J&J was at fault in not properly warning about hip implant flaws but reduced the verdict by about half.  The judge said the $1.04 Billion verdict was about $500 million too high in punitive damages for the six plaintiffs.  J&J will now move forward to appeal the entire verdict.

Hernandez v Crespo
Supreme Court  Florida

The state high court ruled that a medical malpractice arbitration agreement was void as against public policy because it did not include the required provisions of the state Malpractice Act.  The agreement did not have the clinic assume the majority of the costs of the arbitration and did not require the clinic to pay interest on damages.

Torres v Faxton St. Lukes Healthcare

A former patient at the facility was seen for a mental health evaluation after a altercation with a family member.  A restraint order was issued by the physician but the physician mistakenly ordered the patient's release.  He then returned home and murdered the family.  The court ruled the hospital had a duty to the third party who were killed by the patient.

Jenkens v University of Oregon

A student is suing the hospital for failing to diagnose meningitis early.  she went to the clinic where a PA did a nasal swab for flu and told her she had a viral syndrome.  She went to another clinic the same day and was diagnosed with meningitis and was hospitalized for three weeks.  She filed a $3 million suit stating the ten hour delay caused permanent heart disease and mental anguish.  She also had scarring due to surgical procedures.  

Peer Review and Employment

Emlich v OhioHealth
SD Ohio

Another physician goes the wrong road and loses money.  This time a physician had several quality care issues which were rated below the standard of care by outside reviewers.  He also had some professional issues of not seeing patients or making notes daily.  An ad hoc committee and the MEC voted to oust him.  A peer review panel agreed as well.  The physician then made the standard losing move of suing for being a whistleblower.  The hospital filed for summary judgment for HCQIA immunity and was granted same.  


OCS v Presence Health

Chicago Presence Health was fined $475,000 for violating HIPAA by not timely reporting missing OR schedules with patient information within the 60 day window.  This is one that did not involve electronic medical records.


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.