Inside the Sacred Heart Hospital Investigation

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The Medicare fraud scandal at Chicagou2019s Sacred Heart Hospital continues to shock and horrify, with alarming details about unnecessary medical treatment, substandard health care, and Medicare fraud emerging over the past several weeks.

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Last month, the owner, a key executive, and five doctors of the hospital were charged with various crimes in connection with an alleged kickback scheme that involved Medicare fraud and unnecessary medical procedures. According to the Chicago Tribune, one doctor allegedly overdosed patients with sedatives in order to necessitate tracheotomies and lengthy hospital stays and then billed Medicare for the treatment, which cost taxpayers about $160,000.

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But how did federal investigators learn of these alleged crimes and what has the Sacred Heart investigation revealed about the way hospitals are doing business?

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For the past three years, the federal government has been involved in a scrupulous investigation of Chicagou2019s Sacred Heart Hospital, which involved recorded conversations between the hospitals owner, Edward Novak, and some of the hospitalu2019s doctors and an executive.

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On Tuesday, April 16, 2013, federal agents executed search warrants at Sacred Heart Hospital, located on Chicagou2019s west side, and retrieved boxes of medical records, computer drives, and other evidence. According to the Chicago Tribune, approximately 40 patients were at the 119-bed hospital when the raid took place.

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According to the governmentu2019s complaint, Edward Novak (the hospitalu2019s owner) and Roy Payawal (a key hospital executive) concealed more than a combined $225,000 in kickbacks to the doctors as fictitious rental payments, ghost contracts, or payments to teach nonexistent medical students.

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In addition, several of hospitalu2019s doctors were arrested u2013 Venkateswara Kuchipudi, Percy Conrad May Jr., Subir Maitra, and Shanin Moshir u2013 and accused of participating in the illegal kickback scheme. Dr. Kenneth Nave was charged shortly thereafter with prescribing narcotics without a license.

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The investigation also revealed a scheme to admit nursing home patients to Sacred Heart u201cirrespective of any medical necessityu201d by using certain ambulance companies allegedly involved in the scheme that transported the nursing home patients as emergency room patients and directly billing Medicare. No charges were initially filed in connection with these allegations, however.

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Unfortunately, the investigation at Sacred Heart Hospital may be just the tip of the iceberg when it comes to problems within the nationu2019s health care system that extend beyond this particular hospital. According to a Chicago Tribune article, of the $2.8 trillion that is spent on health care each year, approximately $800 billion is paid by taxpayers via the Medicaid and Medicare programs, of which $60 billion is attributed to Medicare/Medicaid fraud.

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If you or a loved one were a patient of Sacred Heart Hospital or suspect that you were the victim of unnecessary medical treatment, it is important to consult with a skilled medical malpractice attorney like the Chicago medical malpractice lawyers at Ankin Law, LLC. Contact our office at (312) 626-7838 to schedule a free consultation to learn more about how we can help protect your legal rights.

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