The False Claims Act, with its threat of treble damages and astronomical per-claim penalties, may not have been designed to punish substandard medical care, but as a recent $15 million FCA settlement demonstrates, the line between substandard medical care and objectively false claims for reimbursement can sometimes be a fuzzy one.

On June 24, 2024, the United States Attorney’s Office for the Southern District of Texas in Houston announced that Baylor St. Luke’s Medical Center (a teaching hospital), Baylor College of Medicine, and an affiliated cardiothoracic surgical practice had agreed to pay $15 million to resolve allegations that they violated the FCA by billing for concurrent heart surgeries.

According to the government’s press release, the heart surgeons at issue would regularly engage in the practice of running two operating rooms at once and “delegating key aspects of extremely complicated and risky heart surgeries to unqualified medical residents.”  According to the government, the surgeries at issue are some of the “most complicated operations performed at any hospital” and typically involved opening the patient’s chest and placing the patient on a bypass machine.

The government alleged that the defendants violated Medicare regulations dictating when teaching physicians can leave the operating room for any operation, no matter how complex.  The government further alleged that in addition to running two operating rooms at once, the surgeons in question failed to attend the surgical “timeout,” which is where the surgical team pauses to identify key risks to prevent surgical errors.

The press release states that the surgeons would allegedly enter “a second or occasionally a third operation without designating a backup surgeon” and that they hid these activities by falsely attesting on the medical records that they were physically present for the entire operation.  The surgeons also allegedly failed to inform the patients that they would be leaving the operating room to perform another operation.

The press release touts this as “the largest settlement to date involving concurrent surgeries.”  The case was the result of a whistleblower lawsuit brought under the FCA’s qui tam provisions.  The whistleblower’s portion of the settlement is $3,075,000.

This settlement is yet another reminder that any healthcare provider who submits claims to federal healthcare programs must understand and follow the various rules and regulations promulgated by the FHP governing those services.  This is particularly true in cases like this, where failure to follow those rules has a substantial risk of patient harm.  In those cases, in addition to significant civil damages and penalties, providers face the risk of serious administrative consequences, such as exclusion or even the loss of their license.

The attorneys at Chilivis Grubman represent businesses of all types and sizes in connection with False Claims Act investigations and litigation.  If you need assistance with such a matter, please feel free to contact us today.