Chicago Hospital Accused of Cutting Throats for $160,000 [View all]

[FarCenter]

Based in part on surreptitious tape recordings, an FBI affidavit lays out allegations that a Sacred Heart pulmonologist kept patients too sedated to breathe on their own, then ordered unneeded tracheotomies for them -- enabling the for-profit hospital to reap revenue of as much as $160,000 per case.

The Sacred Heart case is unusual because of the troubling nature of some of the allegations, said Ryan Stumphauzer, a former federal health care fraud prosecutor in Miami who reviewed the affidavit. “A typical indictment might allege phantom billing or improper coding,” he said. “This complaint alleges the hospital and doctors were performing unnecessary invasive surgery to justify false billing.”

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A physician and two Sacred Heart administrators worked with federal investigators, secretly taping conversations with other hospital staff members, according to the complaint. The 90-page FBI affidavit includes a quote attributed to Novak saying tracheotomies were the hospital’s “biggest money maker.” The hospital’s pulmonologist, or respiratory specialist, is quoted as saying during an April conversation that Novak asked him “to provide two more tracheotomy cases for the hospital soon,” before inspectors -- who had visited the hospital in March -- returned.

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A Sacred Heart surgeon performed tracheotomies on 28 Medicare patients between early 2010 and January, according to the affidavit, which doesn’t identify the surgeon by name. Five patients died within two weeks -- a death rate three times the statewide rate in Illinois.

http://www.bloomberg.com/news/2013-06-14/chicago-hospital-accused-of-cutting-throats-for-160-000.html