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Federal government intervenes in hospital whistleblower suit

December 22, 2018

CHARLESTON, W.Va. (AP) — The federal government is joining a lawsuit against a West Virginia hospital, alleging it improperly issued payments and kickbacks to physicians under the direction of the chief executive officer and management firm.

The lawsuit was unsealed and made public for the first time Friday after originally being filed in 2017. It was made public because the U.S. Department of Justice filed notice with the federal district court it would intervene in the case.

The suit alleges Wheeling Hospital’s physician compensation violated several federal laws — including the Anti-Kickback Statute and the False Claims Act — because it improperly paid millions in excessive compensation based on the volume or value of patient referrals. Some physicians received compensation totaling more than $1 million a year under the system, according to the complaint.

Doing so, the attorneys argue, defrauded Medicare and Medicaid of millions of dollars since 2008.

“The law generally requires that the amount of compensation hospitals pay doctors excludes from consideration the volume and value of patient referrals from those doctors,” said Amy Easton, a whistleblower attorney and partner in Phillips & Cohen’s Washington, DC office, in a statement. “This restriction is important so that doctors recommend treatment plans based on what’s best for patients rather than what’s best for profits.”

Hospital officials in a statement say the complaint is without merit and is an unfair attack on doctors.

“We believe this lawsuit stems from the personal vendetta of a disgruntled former employee and are confident that Wheeling has not defrauded the U.S. government in any way,” said Heidi Porter, Wheeling Hospital’s vice president of hospital and regulatory affairs.

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