A federal judge in Columbia, S.C., has declined to dismiss a whistle-blower lawsuit against Sumter, S.C.-based Tuomey Healthcare System brought by a surgeon in 2005 and picked up by the U.S. Justice Department in September 2007. Tuomey, through its subsidiary specialty groups, allegedly overpaid physicians in exchange for exclusively referring patients to its sole hospital, a 258-bed facility in Sumter, in violation of the Stark law and False Claims Act.
According to the amended complaint the government filed in December 2007, Tuomey initiated the challenged contracts because it feared losing surgical revenue to a new competing surgery center. One of the recruited physicians was orthopedic surgeon Michael Drakeford, who was advised by a lawyer not to sign the contract because it ran afoul of the Stark law. Tuomey and Drakeford then agreed to seek input from Washington health lawyer Kevin McAnaney, an expert on the subject, who advised them verbally that the contracts were problematic, according to the complaint.
The lawsuit calls Tuomey's decision to go forward with the agreements anyway deliberate ignorance or reckless disregard of the Stark violation.
Drakeford tried unsuccessfully to pursue his concerns with Tuomey's board, according to the complaint, and it was Drakeford who filed the whistle-blower lawsuit. Tuomey argued that the government's analysis was flawed regarding how the Stark statute and the CMS' rules should be applied, but Judge Matthew Perry Jr. on Feb. 27 denied the systems motion to dismiss the suit and allowed it to move forward.
Tuomey of course denies any wrongdoing in this case, said Dan Mulholland, a lawyer representing Tuomey. We don't believe the Stark law covers this, and even if it did, these contracts would be perfectly OK under Stark. -- by Gregg Blesch
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