A U.S. Bankruptcy Court judge in Roanoke, Va., approved a $165,000 settlement of a whistleblower lawsuit against the former Lee County Community Hospital, Pennington Gap, Va., according to a Roanoke attorney who represented the hospital. The hospital was sold for $24.9 million in 2001 to Health Management Associates, Naples, Fla., and renamed Lee Regional Medical Center. The agreement settles allegations of Medicare cost-reporting fraud made by a physician who once practiced at Lee County. It paves the way for creditors to be paid in full, with interest, while leaving about $1.5 million to endow a local healthcare foundation, attorney A. Carter Magee said. The hospital filed for bankruptcy in July 2000, about the same time that former Administrator James Luther Davis pleaded guilty to federal racketeering and conspiracy charges. Davis and three other men went to prison for their roles in a scheme involving equipment leases. -- by Vince Galloro
Va. hospital settles cost-reporting fraud suit
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