Jackson, Tenn (May 8, 2015) — The Jackson-Madison County General Hospital District and the U.S. Department of Justice have reached a settlement to resolve a 2007 lawsuit. The JMCGH Board of Trustees approved a resolution during its regular meeting in March to adopt and approve a settlement agreement that has been approved by the U.S. Department of Justice (DOJ).
In a statement released the by West Tennessee Healthcare, the lawsuit asserted claims against JMCGH and others on behalf of the United States for claims submitted to Medicare and TennCare resulting from the services of Elie Korban, M.D. (“Korban”), a physician who treated patients in JMCGH’s cath lab from 2004 to 2011. The allegations were included in a lawsuit, “United States of America ex rel. Deming vs. Jackson-Madison County General Hospital, et al., filed against JMCGH and others by Wood M. Deming, M.D., a local cardiologist under the qui tam or “whistleblower” provisions of the False Claims Act. The U.S. Department of Justice elected not to take legal action against JMCGH following the investigation.
According to the Justice Department, Jackson Madison County General Hospital has paid the United States $1,328,465 to resolve allegations that it billed Medicare and Medicaid in connection with the placement of unnecessary cardiac stents and other unnecessary cardiac procedures. Cardiac stents are mesh tubes placed in coronary arteries to keep the arteries open in the treatment of coronary heart disease. The other related procedures include angioplasty, catheterization, and ultrasound imaging.
Under terms of the settlement agreement, Jackson-Madison County General Hospital (JMCGH) will pay $1,328,465 to the U.S. Department of Justice. As part of the settlement, JMCGH will also pay the plaintiff’s reasonable attorney’s fees, estimated to be approximately $205,000.
The settlement with Jackson-Madison County General Hospital resolved claims that it billed Medicare and Medicaid for these unnecessary procedures performed from January 2004 through December 2011.
“Billing Medicare for cardiac procedures that are not necessary or appropriate contributes to the soaring costs of health care and harms patients,” said Edward L. Stanton III, United States Attorney for the Western District of Tennessee.
“Patient safety and quality of care are our highest priorities,” said Bobby Arnold, West Tennessee Healthcare President and CEO. “We have agreed to a settlement in this case to avoid the delay, uncertainty, inconvenience, and expense of protracted litigation,” he continued. “The claims in the lawsuit were allegations only, and there hasn’t been any determination of liability.”
Jackson-Madison County General Hospital maintains a corporate compliance program to help ensure that all procedures performed on patients are medically necessary and properly billed, said West Tennessee Healthcare President and CEO Bobby Arnold.
Under federal law, Medicare and Medicaid reimburse hospitals only for procedures that are medically necessary.
“Settlements like this protect public funds and safeguard the beneficiaries of federal health care programs.” said U.S. Attorney Edward L. Stanton III
The allegations resolved by the settlement were raised in a lawsuit filed against the hospital under the qui tam, or whistleblower, provisions of the False Claims Act. The act allows private citizens with knowledge of fraud to bring civil actions on behalf of the government and to share in any recovery.
According to the news release from the US Attorney’s Office, as part of the settlement, “the whistleblower” Dr. Wood D. Deming, received a share of the settlement amount.
