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FBI TARGETS PHYSICIANS FROM FORTY-SEVEN STATES IN NATIONWIDE FRAUD PROSECUTION

Federal and local prosecutors have brought criminal charges against physicians in forty-seven states, including New York, alleging that they participated in an elaborate insurance scheme in which thousands of patients were sent to California to undergo reportedly unnecessary surgical and diagnostic procedures and for which the doctors filed more than $1 billion worth of allegedly fraudulent insurance claims. The surgery clinics, located in Southern California reportedly paid recruiters $2,000 to $4,000 for each patient who agreed to undergo a medical procedure and patients reportedly received rewards in the form of cash or discounts on cosmetic surgery. According to the F.B.I. ,the clinics have billed more than $1.3 billion for services provided as part of the scheme. Blue Cross and Blue Shield also filed a civil lawsuit against nine surgery clinics, twenty-one doctors and thirteen others described as owners, employees or administrators of the clinics in which it seeks to recoup payments made for unnecessary procedures. If you are contacted by insurance or government investigators concerning this, or any other investigation, please feel free to contact Kern Augustine for advice and guidance.

BUSH ADMINISTRATION PANEL ADVOCATES ELECTRONIC OFFICE RECORDS

Claiming as its goal, “an effort to reduce the incidence of physician error,” a group of health and information technology organizations recently presented to the Bush administration its recommendations for a national health information network. The group suggested that the information contained in a physician’s office record must be capable of being electronically transmitted to hospitals, laboratories, specialists, insurers and researchers. The study was delivered to the Bush administration's national health information technology coordinator, Dr. David J. Brailer, who had asked for recommendations on how to build a national health information network. The report suggests that the federal government should provide some initial financing and promulgate basic technical standards. The report also concluded that a national health network should not include a central database of patient records nor require individuals to have health identification cards.

GEORGIA CAPS NON ECONOMIC DAMAGES IN MALPRACTICE CASES

Contending that the cost of lawsuits in the state had forced obstetricians and gynecologists to leave their practices, Georgia Governor Sonny Perdue signed into law a bill that caps non-economic damages in medical malpractice cases at $700,000 ($350,000 in total from individual health care providers and $350,000 each from up to two medical facilities). The new law also changes the standard of proof required to prevail in a malpractice lawsuit. Plaintiffs who seek damages for care rendered in an emergency department or an obstetrical unit must now prove by “clear and convincing evidence” that the health care provider was grossly negligent. Formerly, plaintiffs could prevail upon a showing of simple negligence and such cases were judged by the lesser “preponderance of the evidence” standard. On the national front, President Bush once again called for strict limits on medical malpractice suits, including "a cap of $250,000" on what patients could recover for non-economic damages.

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