The Greater New York Hospital Association may appeal a federal judge's decision to throw out the association's lawsuit challenging government audits of teaching hospitals.
In a Nov. 9 ruling, U.S. District Judge Robert Carter in New York said teaching hospitals have no standing to file suit until those audits are completed and the hospitals can claim they were harmed by the government's actions.
"I think it's unfortunate that you cannot challenge an improper action until it's over," said Susan Waltman, the GNYHA's vice president and general counsel.
The physicians at teaching hospitals, or PATH, audits review how faculty doctors at teaching hospitals bill Medicare for work that interns and residents actually perform. HHS' inspector general's office has audited 50 hospitals since the national investigation began in 1995. So far, six teaching hospitals and their faculty practice plans have paid $75.2 million to resolve charges that they inappropriately billed Medicare for those services.
In April 1998, the GNYHA and seven hospital and medical school plaintiffs sued HHS, saying the audits were unfair because federal investigators were reviewing hospital and physician billing practices using billing rules not in effect when the claims were submitted.
One of the plaintiffs, Mount Sinai-NYU Hospitals/Health System in New York, dropped out of the lawsuit and settled with the government for $2.2 million in October.
Judge Carter's decision to throw out the case marks the hospital industry's second unsuccessful effort to derail the PATH audits and investigations. In an October 1997 lawsuit filed in U.S. District Court in Los Angeles, the American Hospital Association, the American Medical Association and the Association of American Medical Colleges alleged that HHS' inspector general's office was applying Medicare rules retroactively when it launched the PATH audits.
On April 27, 1998, U.S. District Judge Carlos Moreno dismissed that suit, which the providers have appealed to the 9th U.S. Circuit Court of Appeals in San Francisco. No date has been set for arguments.