Maryland hospital settles unnecessary stenting case for $22 million

November 11, 2010 by MassDevice staff

St. Joseph Medical Center in Baltimore agrees to pay $22 million to settle a federal lawsuit accusing it of bilking Medicare for unnecessary stent implantations, without making an admission of guilt.

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St. Joseph Medical Center in Baltimore agreed to pay $22 million to the federal government to settle a whistleblower lawsuit accusing it of bilking Medicare for un-necessary coronary stent implantations.

The lawsuit, which was under seal until Nov. 9, was filed by a trio of cardiac surgeons who alleged that the hospital and an independent practice, MidAtlantic Cardiovascular Associates, ran a 10-year scheme to drive referrals from St. Joseph to MACVA.

"Between January 1, 1996, and January 1, 2006, MidAtlantic Cardiovascular Associates ... demanded and [St. Joseph] agreed to pay remuneration in excess of fair market value and/or for services that were either not rendered or were not reasonably related to a legitimate business purpose, in exchange for the referral of lucrative cardiac procedures by MACVA to [St. Joseph], including but not limited to cardiac surgeries and stents," according to the settlement, which does not include an admission of guilt.

In January, the hospital notified 369 patients that they may not have needed the stent procedures they underwent. That prompted federal officials to investigate the Towson, Md.-based hospital for healthcare fraud, with now-former St. Joseph's cardiologist Dr. Mark Midei the only doctor implicated.

The hospital and Midei were slapped with a class-action lawsuit over the case two weeks later. A Towson attorney later filed 101 complaints against the two alleging conspiracy, negligence and fraud.

"From January 1, 2008, through May 12, 2009, [St. Joseph] submitted or caused to be submitted false claims to [Medicare] for medically unnecessary stent procedures performed [Midei] while he was employed by [St. Joseph]," according to the settlement.

Drs. Stephen Lincoln, Peter Horneffer and Garth McDonald, who filed the suit the government later joined, stand to split nearly $2.8 million, their share of the settlement from their "qui tam" whistleblower lawsuit.