August 1, 2012 Recent Legal News




Peer Review and Employment



US v Multiple People

The feds arrested dozens of people who where allegedly involved in a scheme to repackage drugs.  They used Medicaid to obtain the drugs and then either repackaged them or resold them again to other Medicaid recipients.  

US v Vest

Dr. James Vest of Myrtle Beach was accused of billing for patients never seen by him but by ancillary personnel.  He settled the case for $325,000.

US v Le Chabrier

Dr. Lana Le Chabrier of Santa Barbara, California, was sentenced to six and a half years in prison for health care fraud.  She billed over $1 million in false claims and received $400,000 illegally.  She attempted to flee but was caught at the Canadian border.  She was the co-owner of a store front clinic in Richmond that billed patients never seen but brought to the clinic by cappers.  The clinic made up files for the false patients and then sent the files to Southern California where Dr. Le Chabrier signed them.

US v Chhibber

Dr. Jawinder Rai Chhibber of Chicago was sentenced to 2 and one half years in prison for submitting false claims for unneeded tests to Blue Cross Blue Shield.  

US v Sachdeva

Dr. Meera Sachdeva of Summit, Mississippi, the founder of Rose Cancer Center pled guilty as did her billing agent of health care fraud.  They diluted chemo drugs and billed for treatments for the times she was out of the country.  

US v Graves

Physician Assistant Cal Graves of Dallas, Texas, pled guilty of healthcare fraud.  The physician pre-signed prescription blanks and did not supervise the physician assistant.  The physician trial is later this year.

US v Wijetilaka

Yonlers, New York, cardiologist Rohan Wijetilaka has been accused of illegally distributing Oxycodone.  He was accused of either selling the drug for cash or in exchange for billing the person's insurance for treatment never rendered.  His license had been suspended earlier in the month. 

US v Schwartz

Yuba City, California, physician Irving Schwartz has been indicted in a fraudulent scheme involving electric wheelchairs.  The doctor has been accused of going with a co-conspirator to El Centro, California, where he wrote prescriptions for power wheelchairs not needed.  Dr. Schwartz is alleged to have received $300 per prescription written. 

US v McKesson Corp

McKesson agreed to pay to the states and the DC $131 million for overbilling the Medicaid program by as much as 25% from 2001 to 2009.  The company denied any wrongdoing.   

Minnesota v Accretive Health

Accretive has agreed to stay out of the state for six years.  They will also pay $2.5 million to patients and return all records to the hospitals that hired them.  The patients who will get money are the one's that had to pay past bills prior to being seen in a hospital's ED.    Top


Traversie v Rapid City Regional Hospital

The patient, a blind Lakota man living on the reservation, sued the hospital for allegedly carving the initials KKK on his abdomen while doing heart surgery.  The hospital, physicians and the police who investigated can not make out the letters.

Rindsberg v Neacsu
GA Ct app

In the trial court the physician who was covering won a summary judgment as she was not the attending physician.  The Court of Appeals overruled the trial court in the wrongful death case stating that the refusal to re-examine the patient when requested was an act that may have satisfied the physician patient relationship. This means there is a dispute of the facts and summary judgment is not appropriate.

Fowler v Triage Staffing

One of the thirty patients to date that have contracted hepatitis from an traveling nurse working at Exeter Hospital in New Hampshire has filed suit against the staffing agency that supplied the nurse to the hospital.  The nurse left a trail of hepatitis patients across the country.  Exeter Hospital will test 6000 more individuals for HIV and Hepatitis.  

Scott v Bard
Jury Trial

Scott sued Bard Co. for injuries incurred from the use of vaginal mesh.  She received an award of $5.5 million but of course will never see the majority of the money.  The case will be appealed and a settlement reached.  Also the attorneys will take a percentage of the award.  This is the first case in the country regarding the vaginal mesh implants from multiple companies.  J & J has stopped selling all of it's mesh.  There is a consolidation of federal suits against J & J, Bard and Boston Scientific in West Virginia.  The first of those cases is scheduled for February.         Top


Colorado v Stein
Colorado Investigation

Stephen Stein, DDS, an oral surgeon is being investigated for prescription fraud and reusing needles and syringes.  Dr. Stein can not be found.  The Dept. of Health has sent out 8000 letters to his patients asking that they be tested for HIV and Hepatitis. 

Florida v Morris

Oneal Ron Morris of Hollywood, Florida was arrested for manslaughter after the death of a woman he injected with silicone.  Mr. Morris is not a physician but injected the woman in the buttocks.  The material moved and she died from "massive silicon migration".  The silicone was from Home Depot and the punctures sealed with gauze and superglue.         Top

Peer Review and Employment

Medical Staff v Avera Marshall Med Ctr
Minn. Trial Ct.

As I said several months ago physicians should avoid working at any Avera hospital.  When the medical staff and the chief of staff has to sue the hospital in order to do what they are supposed to do, physicians should run, not walk, away from the hospital and system.  The court ruled the medical staff is not an entity that can sue or be sued.  The individuals can sue.  The individuals can get the costs but not the attorney fees if they prevail.  The court still must rule if the bylaws are a contract or not.

Davis v Jefferson Hospital Assn.
8th Circuit

The physician was terminated for many reasons and sued under the Civil rights Act.  He lost.  He failed to prove any aspect of his case.  It boggles the mind that any legitimate attorney would take this case.

Chudacoff v University Hospital
D Nevada

This long running case continues due to the hospital stonewalling.  The court found that the hospital did not do what was ordered of it but declined to impose sanctions.  It did impose sanctions for not totally removing the false report to the NPDB.  The amount of the sanctions will be decided separately and the hospital still must comply with the removal of the entire false report.  The court refused to rule on the breach of contract issue since Nevada has never ruled that medical staff bylaws are contracts.

Chaudhuri v Fanning Regional Hospital
Ga Ct. App.

The court of appeals overruled the trial court summary judgment ruling regarding the breach of contract between the physician and the hospital.  The doctor was named the hospitalist which had certain geographical limitations to the job.  He recognized the inability to perform the limitations and told the CEO about the problems.  He was told not to worry.  Several months later he was fired due to not abiding by the limitations.  This case came about due to the hospital attorney drawing up a contract that was unenforceable and unconscionable.  The physician had all the summary judgment rulings reversed.

UC Davis v Muizelaar

Drs. Muizelaar and Schrot of the University of California Davis neurosurgical department were barred from human research after they put bacterial pathogens into open head wounds in terminal brain cancer patients.  The former is the head of the department.  They had patient consent and believed they had FDA consent as well.  They did not have university consent nor any other regulatory body consent.

Gaalla v Citizens Med Ctr.
SD Texas

Three Indian cardiologists were left out when the hospital passed a rule that the cardiology department was closed to anyone without a hospital contract.  They sued and in Distrrict Court the cardiologists won an injunction.  The hospital appealed and the 5th Circuit stated that the due process claims were not valid since the hospital board had a valid business reason for their action.  The equal protection action was remanded back to the District court.  The claims were dismissed in the lower court due to legislative immunity.

Helm v Gatewood Emergency Services
MD Florida

The ED physician claimed retaliation for having her hours reduced after her sexual harassment claims against her supervisor.  Summary judgment was  not allowed since their was a fact to be determined as to whether or not she was an independent contractor or an employee.  The court tossed the sexual harassment claims since the action was not severe enough to rise to the need for a law action.  The retaliation action was allowed to stand for trial.

Genova v Banner Health
D Colorado

The ED physician worked for a group that had an exclusive contract with the hospital.  The physician made an angry phone call to the hospital CEO wanting to transfer patients when the ED was full.  The CEO told the group to fire the physician from all hospital duties.  The physician sued the hospital and CEO.  The physician and the physician's attorney screwed up when they failed to read the contract between the hospital and the group.  The court said that indeed the physician was a bona fide party to the contract between the hospital and the group but the contract allowed the hospital to request the removal of any physician when the hospital in its sole judgment believed the physician's conduct was against the hospital interests.  The physician had also signed an addendum to the contract waiving his right to sue the hospital for breach of contract.  There seems to be a fair number of suits against Banner as opposed to other hospital systems for actions against physicians.  It would be wise if any physician was considering working for Banner in any capacity that the physician and his attorney should scrutinize any writing very very carefully.        Top


Miniet v Sebilius
SD Fla

Dr. Ralph Miniet's practice of injecting patients with Rho D was flagged by the intermediary and 60 charts reviewed.  It was determined that 100% of the injections were for "medically unbelievable doses" of the medicine.  Based on this sample the contractor extrapolated the money that need to be reimbursed to all the 567 claims and deemed the physician owed Medicare $2.3 million.  The physician appealed the decision to an ALJ who found the extrapolation did not follow CMS guidelines.  This was overturned by the Medicare Appeals Council who stated the ALJ did not have the authority to make this call.  The court upheld the decision of the Council and the physician owes the money.        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.