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It was a circuitous route to a false claims settlement: a handful of employees at Lancaster General Hospital in Pennsylvania told two private-practice physicians that ultrasounds performed on high-risk pregnant women allegedly weren’t interpreted for 10, 30 or 90 days—and were billed to Medicaid and Medicare anyway. So the physicians, who have hospital privileges, were surrogates for the employees in reporting their concerns to senior leaders at University of Pennsylvania Health System, which operates as Penn Medicine and includes Lancaster General Hospital. From there the allegations sound like a typical whistleblower case—except it wasn’t one. When the physicians felt dismissed, they tipped off the U.S. Attorney for the Eastern District of Pennsylvania without filing a qui tam complaint, and an investigation followed. A little more than a year later, there’s a resolution.
University of Pennsylvania Health System has agreed to pay $275,000 to settle False Claims Act (FCA) allegations that Lancaster General Hospital’s Division of Maternal Fetal Medicine (LGH-MFM) billed during an eight-month period for obstetrical ultrasounds that weren’t evaluated in a timely manner, the U.S. attorney’s office said June 26. The settlement also requires Penn Medicine to perform annual audits of 20 outpatient obstetrical ultrasounds and submit the findings to the government for three years. Penn Medicine did not admit liability in the settlement.
“This story is about more than a $275,000 settlement. We reported this stuff in writing [to Penn Medicine] in all clarity and expected follow up and didn’t have that happen,” says Christian Macedonia, M.D., one of the two physician tipsters. “Then we reached out to the U.S. attorney.” He and his partner, Robert W. Larkin, M.D., who are maternal fetal medicine physicians with a private practice, Lancaster Maternal Fetal Medicine, a mile from the hospital, spent a lot of time and money trying to right a wrong, Macedonia tells RMC.
“It is not good enough [for people] to say ‘I don’t harm patients or commit fraud.’ You have to speak up, or you are complicit in it,” he says.
According to the settlement, because of “insufficient physician staff to properly handle its patient volume,” LGH-MFM billed for obstetric ultrasounds from May 1, 2017, to Dec. 31, 2017, even though its maternal fetal medicine physicians didn’t complete timely reports on the ultrasounds they ordered “in numerous instances.” In many cases, LGH-MFM physicians didn’t finish their reports of ultrasounds until more than 10 days after the ultrasound. Some weren’t done for more than 30 days, at least 10% weren’t completed for 90 days and some ultrasounds weren’t interpreted until after women delivered their babies. U.S. Attorney William McSwain said in a press release that the “alleged conduct not only demonstrated an abuse of the Medicaid program, but had troubling implications for patient care.”
But the government was unaware of this in late 2017, when Macedonia and Larkin got an earful about the obstetric ultrasounds from some employees at Lancaster General Hospital, according to an interview with Macedonia and copies of letters he and Larkin sent to Penn Medicine’s chief counsel, Lee Dobkin, and to the U.S. attorney’s office. OB/GYNs order the ultrasounds and they’re interpreted by maternal fetal medicine physicians, who are consultants specializing in high-risk pregnancies, such as patients with heart disease and diabetes, Macedonia says.
M.D.s Say It Was ‘Ethical Duty’ to Report
The two physicians were previously employed by Lancaster General Hospital. They unwound the arrangement in 2017 to set up their own shop, but kept their hospital privileges, Macedonia says. After Larkin and Macedonia left, the hospital still employed two maternal fetal medicine physicians. “Penn Medicine has 18 maternal medicine specialists in Philadelphia and two in Lancaster. That’s more than enough to cover the ultrasound workload,” Macedonia contends. Pennsylvania requires physicians to evaluate ultrasounds within 30 days, but the standard of practice is two to three days, he says.
After hearing about the lag time in ultrasound interpretations, Macedonia and Larkin sent Dobkin a letter on Dec. 4, 2017. It alleged that “since May of this year, hundreds of ultrasound examinations were performed without being resulted by a physician—that is, without a report prepared by a physician and contrary to the Penn Medicine protocol of a written report within 24 hours,” Macedonia and Larkin wrote. They explained they felt it was their “ethical duty” and their “duty” to the Lancaster community and Penn Medicine to inform Dobkin. OB/GYNs who requested the reports have complained, but Lancaster General Hospital hasn’t fixed the problem, Macedonia and Larkin alleged. Ultrasound technicians and customer service representatives were told to enter the technical component of the ultrasounds in the billing system before they were interpreted, with the professional component billed later. “The employees raised these concerns with [Lancaster] leadership as possibly illegal acts, but received no satisfactory response,” the physicians alleged. “People close to the issue estimate that about 1,400 ultrasound records are affected by either lack of report in a timely fashion, improper billing, or both.”
Six different people told Macedonia and Larkin of the ultrasound interpretation problem, they said in the letter, which asks for an internal audit and investigation.
Macedonia said he and Larkin also had a one-hour meeting with Dobkin. They explained it would be easy to confirm their concern by looking at Epic, the electronic health records system. “It logs every key stroke,” Macedonia says. “You can see when the report was done and when the bill was dropped.” He said they told Dobkin if Penn Medicine’s auditor would look into it and let them know, “we will consider that a good-faith sign you are interested in getting to the bottom of the problem.”
Dobkin wrote back to the physicians twice. In a Jan. 26, 2018, email, which Macedonia shared with RMC, Dobkin assured the physicians’ attorney that “our review of the records is continuing. It may be that we have a difference of opinion as to the amount of time it should require to complete that task, but to my way of thinking a thorough and reliable work product is an end goal that is in everyone’s interest, and it is well worth the time to achieve.”
But as far as the physicians could tell, two months went by and nothing changed. “I said, ‘it’s time to call the U.S. attorney,’” Macedonia remembers. Although the physicians talked about a whistleblower case—“I’m not allergic to money”—in the end, they decided just to provide information to the U.S. attorney, Macedonia says. “I made the conscious decision not to qui tam this. I wanted this to be completely unfettered by those motivations,” he says. The physicians just wanted the system to work. “The only reason I regret not being a qui tam relator is…we stepped forward with all sorts of valuable information without the protective bubble the U.S. attorney’s office provides to whistleblowers.”
Penn Medicine Says It Has Made Progress
In the letter to the U.S. attorney, the physicians again spelled out the problems with obstetrical ultrasound evaluations. “We are not fact witnesses,” Macedonia and Larkin emphasized. They were asked to raise the issues to senior executives at Penn Medicine by employees who felt too “discouraged” and “frustrated” to come forward. Although there was a meeting with Dobkin two months earlier, the letter said “Penn Medicine has not given us information confirming that it has performed an audit.”
Dobkin responded to the physicians again in an April letter. “Considerable improvement has been made,” Dobkin wrote, including Lancaster hiring a third MFM physician in December 2017. In fact, a February 2018 review of ultrasounds “showed substantial progress in the timely completion of professional reports.” There was no evidence that delays had affected patient safety, he said. “Our review indicated that referring physicians were personally contacted if the ultrasounds contained critical information, and that the MFM physicians prioritized the completion of their reports when they observed a change in patient status or recommended a change in the care plan,” Dobkin explained. “That said, there is no question that it is a better practice to complete these professional reports in a timelier fashion, and [Lancaster] is committed to continuing to improve this process going forward.”
Although Lancaster General Hospital took the physicians’ complaint seriously, “we are unaware of any billing rule” that prohibits reimbursement for the technical fee if it’s billed before the professional fee, Dobkin wrote. He noted the hospital has had a compliance office for decades, to which the physicians could have brought their concerns.
“Penn Medicine is strongly committed to compliance, and we value the opportunity that such discussions can provide in furthering our goal,” he said.
It May Take Time to Get Back to People
The story told by Macedonia and Larkin is familiar to the whistleblower lawsuits filed year after year, says former compliance officer Margaret Hambleton, president of Hambleton Compliance LLC, in Valencia, California. People use internal systems to report a problem, and if they’re unsatisfied by the response, they knock on the U.S. attorney’s door, she says. “That doesn’t mean Penn Medicine or every organization that settles false claims allegations did something wrong,” she says. They may have been auditing and performing a root cause analysis of errors but move slowly, “and the people who raised the concerns weren’t in the loop sufficiently to know something was being done.” Sometimes, however, organizations get a “target focus” that can lead to noncompliance. For example, they’re so determined to solve one problem (e.g., hiring more MFM physicians to interpret ultrasounds) “without looking at the entirety of the problem for false claims, which includes billing for services that aren’t considered medically necessary when they aren’t read within 30 days,” Hambleton says, although she is not specifically commenting on Penn Medicine’s conduct.
Organizations also have to ensure that employees can escalate problems if they don’t feel the compliance office is responsive to a complaint. “If they percolate it up through the reporting system, then it should catch somebody’s attention,” Hambleton says, including the compliance committee, the executive management team and the board. “There should be lots of opportunities for eyes to be on an issue if it gets reported and it’s significant.”
If the problem at Lancaster General Hospital was understaffing and it only persisted for eight months, “it’s hard to understand how this rises to reckless disregard,” the standard of proof for a FCA violation, says attorney Jeff Fitzgerald, with Polsinelli in Denver, Colorado. “The fact that the physicians don’t like how certain hospital operations are run doesn’t mean the hospital is trying to commit fraud. Yes, the U.S. attorney got involved, but the resolution was only a few hundred thousand dollars. So what does that mean? Were they imperfect in how they were acting? Maybe, but that’s not what the False Claims Act was designed to fix.”
RMC asked for comments from Dobkin. In an email response, Dobkin said that Lancaster General Hospital “determined that a backlog had developed in the completion of some ultrasound professional reports, remediated the problem and reported it to the Department of Health, all before the initiation of the federal investigation. [The hospital] cooperated fully with that investigation, as part of its longstanding commitment to compliance.”
Contact Macedonia at email@example.com, Hambleton at firstname.lastname@example.org and Fitzgerald at email@example.com. Read the press release at http://bit.ly/2X6xFi1. ✧