September 15, 2011 Recent Legal News



Peer Review and Employment





US v Perez

Farah Perez, RN., of Miami, pled guilty of Medicare fraud.  She and her do-defendant nurses worked for a home health agency and falsified medical records to make it appear the people were in need of the services.  The people did not need the services.  She will be sentenced in November.  

US v 91 People

The feds have charged 91 people across the country with health care fraud.  They raided and arrested people in eight locations including physicians, nurses and other healthcare professionals.  The feds claim $263 million in false billings that happened in the past and they have now found.  Sebelius stated that this doesn't end here since Obamacare has given HHS the power to prevent Medicare fraud before it happens.  I don't know how one stops something before it is done but I do know they can be more efficient in catching the crooks sooner before they bill millions of dollars in false claims.  Caught in the net were ten physicians for false psychotherapy sessions, kickbacks and illegal pain meds.

US v Holland

Erika Holland of Mr. Holly, North Carolina, pled guilty of money laundering and conspiracy to commit health care fraud.  She cheated the government f over $1.4 million and purchased autos, time shares and a home.  She and two others falsely billed for mental health services they were not licensed to perform and did not perform.  The other two had previously pled guilty.   

US v Janzen, Johnson & Rockwell Emergency Services

The management company agreed to pay $4.6 million to settle allegations of upcoding on ED physician claims.  This was a whistleblower case by a former employee who will receive $775,000.  I wonder who will actually pay the money, the company or the physicians or the companies insurance company.       

  Chesbough v VPA
6th Circuit

Two radiologists sued a home health organization for violation of the False Claims Act. The radiologists had a contract to read images taken by the providers techs.  The images were so bad that they were dangerous to read.  They sued saying that the government wasn't getting what it paid for.  The suit was dismissed since images being up to the standards of the American College of radiology is not necessary for payment.  Also the rest of the case was dismissed since the radiologists had no personal knowledge of whether or not the defendants ever billed for the technical component.  I would hope the feds look into the claims and if they were billed then to after VPA for damages.    

US v Ohio Valley Hospitals

Two hospitals and their parent Ohio Valley Health Education & Services Corp. have agreed to pay $3.8 million to settle illegal kickback charges to physicians of their hospitals. The feds will next go after the physicians to return the illegal money plus fines.  Earlier this year the Board sued the now former CEO for making the illegal payments and for falsifying information to the board.        Top


Patients v Dean Clinic
To Be Filed

Dean Clinics in Wisconsin have notified about 2500 patients that the have potential exposure to Hepatitis and/or HIV.  They state this is due to a nurse at the clinic certified in diabetic education saw patients in the various clinics.  She showed patients how to do finger sticks or use insulin pens.  It is possible but not probable that some blood may have been transferred since the pens were never designed to use on humans only oranges for demonstration purposes. 

7th Circuit

The federal court ruled that physicians in Illinois can not be shielded from med mal suits if they are paid a salary by the hospital and respond to a hospital emergency.  The "Good Samaritan Law" will not cover them.  As long as they are paid any fee, not just from the patient, they are not shielded.

Baker v Farrland
Maine Law Court  

The court stated that Maine law permits a continuing negligent medical treatment doctrine.  This allows a med mal suit outside the recognized three year statute of limitations codified in the state.  The case came when a primary care physician did annual PSA tests on a patient for six years before referring him to a urologist.   The claim was he should have been sent earlier so he would have more and better choices.  The case now goes to a hearing panel and then possibly to court. 

Nightengale v Timmel
Idaho Supreme Court

Dr. Gross amputated Nightengale's arm for a blood clot.  He wrote to a hospital to look at the patient record for possible peer review by Dr. Timmel, an ED physician who was being sued by Nightengale.  The letter was mistakenly turned over to the plaintiff and the judge refused to have the letter entered into evidence.  Timmel won and Nighengale appealed.  The high court said that the letters do not have to be in the hospital but just related to the peer review process to be protected.     

Oliver v Magnolia 
La Ct App

The parents of a child undiagnosed by a nurse practitioner on many occasions for neuroblastoma sued and won $10 million in damages.  The amount was reduced by virtue of the state medical cap law to $500,000.  The court stated the nurse practitioner was not covered under the cap and the original judgment stands.  It will be appealed to the state Supreme Court.

Kaplan v Mayo Clinic
8th Circ

Kaplan sued the employee physician and the hospital for breach of contract after the physician told the patient that he would biopsy the pancreas before proceeding to other surgery.  He failed to biopsy the pancreas and did a Whipple procedure.  The final pathology came back without cancer.  The lower court found in favor of the surgeon and the hospital on negligence and stated the breach of contract was part of negligence.  The higher court did not agree and remanded the case for trial on the breach of contract issue.    

Patients v ???
Will not be Filed

At least 23 children with Thallasemia received HIV tainted blood at a government hospital in India.  They are all of a low caste system so will receive little or no compensation.

Gordon v Howard Regional 
Indiana Supreme Court

Gordon sued after her child was born with neurological defects.  She sued her OBs and the hospital for losing the important medical records.  The Supreme Court stated that the loss of records can not be sued for separately but only as a part of the med mal case.  The court hearing the underlying case can instruct the jury that the records can be construed as being in the plaintiff's favor.  However, the plaintiff still has to build a case in the usual manner.  It will be alot harder for the physician or hospital to defend without records.       Top

Peer Review and Employment

El-Attar v Hollywood Presbyterian Med Ctr
Ca Ct App

Dr. El-Attar, a cardiologist at the hospital, was investigated by the Board of Directors on their own after complaints were made about the physician.  The MEC granted him privileges but the Board refused to agree.  The physician requested a peer review but the MEC refused to convene it since they had already examined the physician and given him privileges.  The Board, although they had no right, convened a peer review panel which agreed with the Board.  The Dr. appealed to the Board and of course lost.  He then sued and lost in the lower court but won in the court of appeal.  The high court stated that the board had no right to appoint a committee as the bylaws stated the committee must be appointed by the MEC and they could not defer their duty.  The case now goes back to the hospital for a new peer review.  Horty Springer who reported on this case attempted to deflect the true issue of the case as the poor practice of the physician when it was the hospital's poor legal skills that was the problem. The case against the physician was not legally proved.   

Ormand v Sanford Health
Trial Ct.

Dr. JoAnn Ormand filed a wrongful termination suit against the system and in that suit contended the system's non-compete clause was illegal.  The court agreed with the physician that the twenty mile limit for two years would be detrimental to patient care if the patient wanted to follow the physician.  The system wants the state high court to review the decision.       

Tuli v Brigham's Woman's
1st Circuit

Tuli, a surgeon, was subjected to sexual harassment and lost her privileges at the hospital when she complained.  She sued for an injunction and damages.   She won the injunction and damages of $1.1 million against the supervising surgeon and the hospitals.  The 1st Circuit agreed.        

Crow v Penrose St. Francis Health
Colo App Ct

In a case of probable legal malpractice a physician was terminated from the hospital and sued instead of going through the formal appeals process.  The case was dismissed for not following administrative guides.  The physician and I hope the attorney was told by the court to pay the hospital's legal fees of over $100,000.  This is under Colorado rules and not HCQIA.

Hergenreder v Bickford Senior Living
6th Circ

In what may be a very important case if it transfers to medical staff rules, a nurse after being at the hospital for a short time took a leave of absence for cancer treatment.  When she returned she found she was fired.  She sued and the institution said she needed to arbitrate.  The court stated that since she did not read the Employee Handbook reference to the Dispute Resolution  Procedure it was void.  Think about what is in the documents physicians sign agreeing to abide by what is in the Board of Trustee Bylaws and are never given them to read.  This case could mean the end to the hospital attorneys placing things in the Trustee bylaws and never showing them to the physicians until they accuse the physician of breaking the bylaw.     

Patients v Potti

Eight patients have filed suit against Duke University and Dr. Anil Potti for fraudulent clinical trials.  Dr. Potti had been previously put on paid administrative leave by the university for falsifying information in a medical journal.  He then had to retract five published papers that could not be independently verified.  The university is being sued for lack of verifying credentials and lack of oversight of the research leading to patient harm.         Top


Coast Plaza Doctor's Hospital v BlueCard
Ca Dist Ct.

Coast sued BlueCard in state court for various state issues.  BlueCard took it to fed court under ERISA and Diversity.  Diversity lost since the matter was under the $75,000 limit and BlueCard had the burden and could not show it was over the threshold amount. The also was not ERISA claims involved so the case was remanded back where it belonged, state court.  It is amazing how much money and time can be wasted by attorneys who should know better.        Top 


UAPD v Ventura County
Public Employee Relations Board

The Union of American Physicians and Dentists won a strongly worded ruling requiring the county to bargain with the UAPD.  They had already been recognized as the bargaining unit but Ventura had refused to bargain. The judge also ordered the county to pay the union their legal fees.  Ventura will appeal and spend more taxpayer money and lose again.   

Patients v Stanford Hospital
To Be Filed

Again a major hospital screwed up electronic records.  This time it was Stanford.  They put on their web site 20,000 records of ED patients including names and diagnostic codes.  It was there for almost one year before they found their error.  That is a long time to go undiscovered.  In the past two years over 11 million people have had their private medical records breached by hospitals mismanaging electronic records. How many paper records were compromised in the past 100 years.      Top 


Virginia v US
4th Circuit

The three judge panel stated that Obamacare's individual mandate is legal and that Virginia had no standing to challenge the law.  This overturned a lower court decision.  It is a matter of when the Supreme Court takes this case and whether it will be decided prior to the 2012 elections.

Bachman v US
Federal Ct

A federal judge in Pennsylvania struck down as unconstitutional the individual insurance mandate but left most of the rest of Obamacare intact.        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.