King’s Daughters Medical Center Admits Nothing, But Pays Anyway

July 3rd, 2014 by Attorney Dan Carman

“Millstones of Justice turn exceedingly slow, but grind exceedingly fine,” said John Bannister Gibson, who served as Chief Justice on the Pennsylvania Supreme Court for 24 years in the first half of the 19th century.

For King’s Daughters Medical Center (KDMC) in Ashland, justice was finally served, in a sense, following an investigation by the Department of Justice (DOJ) into allegations that the heart doctors at KDMC were implanting stents in patients when the stents weren’t really needed—an investigation that started in 2011. For KDMC, justice meant agreeing to pay the U.S. government $40.9 million to settle the allegations.

While KDMC—which says it has received top rankings for cardiac care from independent panels—didn’t admit to any wrongdoing, it did agree to make internal reforms and to increase the monitoring of its claims to federal healthcare programs for the next five years. Hospital officials said they made the “difficult decision” to settle and pay rather than spending money to defend allegations made in “old cases.”

The settlement amount, which is thought to be the largest ever dealing with suspected healthcare fraud in the Eastern District of Kentucky’s federal court, reflects about twice what KDMC received from alleged improper billing of patients, under federal law that allows up to triple damages in cases involving alleged false claims in government programs. In KDMC’s case, the alleged fraud covered by the settlement took place between January of 2006 and December of 2011.

And, while KDMC’s settlement may mean DOJ’s spotlight is less focused on its ongoing operations, the hospital has agreed to cooperate with state and federal authorities who are continuing to investigate individual cardiologists who are or were employed by KDMC or its subsidiaries. DOJ says five doctors referred patients to the hospital after they were given “unreasonably high payments,” and a civil and criminal investigation is continuing, with KDMC fully cooperating in the investigation.

KDMC has settled, with an agreement that they be monitored and that they cooperate in ongoing investigations of doctors, but the feds are still very much in the game of investigating and punishing healthcare fraud in Kentucky. The U.S. District Attorney in charge of fraud investigations reorganized his office four years ago so greater focus could be put on alleged healthcare fraud. He supervises attorneys, an investigator, and an auditor, and they all work with the FBI, the U.S. Department of Health and Human Services, and the Kentucky Attorney General’s Office.

The good news is that DOJ believes the majority of doctors and healthcare facilities run honest operations, but that the great amount of money to be made in health care simply tempts some to cross the line. That’s who the feds are after—and they have their own money sources to run diligent investigations.

Are you reading this because you’ve found yourself, as a doctor or other worker in the healthcare industry, under federal investigation for possible fraud because of a whistleblower complaint or other alleged activity? You need to take action today to combat any charges that may be brought against you. Your first step should be to talk with a knowledgeable healthcare fraud attorney about potential or pending charges.

Dan Carman is an experienced Lexington healthcare fraud attorney who can work with you on defense of any charges against you for healthcare fraud. He is admitted to practice law throughout Kentucky, in the United States District Courts for the Eastern and Western Districts of Kentucky, and in the Sixth Circuit of the United States Court of Appeals. Dan has the experience you need if you find yourself in federal court. Call him now at (859)685-1055 or fill out his confidential online contact form.