Fata allegedly subjected at least 553 patients to unnecessary treatments over several years through Rochester Hills-based Michigan Hematology Oncology PC, his oncology clinic, including chemotherapy treatments to some who did not have cancer. That clinic along withCrittenton Hospital, McLaren Health Care Corp. and St. Joseph Mercy Health System, a subsidiary of Trinity Health, will pay the settlement award.
McLaren in a statement on Wednesday acknowledged the $8 million "global" settlement, but said it never had any "relationship or affiliation with his (Fata's) clinical practice" — only a landlord-tenant relationship for Fata to house offices at its McLaren Health Care Village at Clarkston.
"While this settlement will never change the devastation suffered at the hands of Dr. Fata, we hope it brings about some justice for the patients and their loved ones who struggle with this tragedy every day," the hospital statement read.
St. Joseph Mercy Health System also offered a statement on Wednesday. "St. Joseph Mercy Oakland's involvement with these patients, the lawsuit and settlement was minimal and no findings of responsibility were made. However, we believe participating in this settlement is in the best interest of our patients and the community."
St. Joseph Mercy Health System also expressed hope that the resolution provided some relief to affected patients, according to the statement.
"Unfortunately under these circumstances and under Michigan Law, Fata's victims were never going to receive fair levels of compensation…," attorney Brian McKeen, managing partner ofMcKeen & Associates and co-lead counsel for the patient-victims in the facilitation talks, said Wednesday in a statement.
"It is outrageous (that) doctors are allowed to practice with inadequate insurance and hospitals can distance themselves from liability."
Fata pleaded guilty to criminal fraud and money laundering charges in 2014, admitting in federal court that many patients didn't need chemotherapy and that the government could prove he received at least $17 million from two insurers for his services.
McKeen also said in a Wednesday statement that Fata's insurance policy had exclusions for willful and fraudulent acts, so "there was a very real possibility that the insurance carrier would be allowed to walk away" if no deal was reached.
Bruce Bigler, an attorney for Crittenton at Giarmarco, Mullins & Horton in Troy, did not immediately return phone calls seeking comment Wednesday on the settlement. Randall Juip, a partner at Foley Baron Metzger & Juip PLLC in Livonia representing Michigan Hematology Oncology in several Oakland cases, also could not be immediately reached.
Jules Olsman, president of Olsman MacKenzie & Wallace in Berkley and co-lead counsel for the patients in facilitation, said individual hospital contributions to the settlement fund were confidential, but that each hospital's fund is expected to address patients treated at its facilities or through its referrals.
He also noted Fata's limited insurance and said medical malpractice cases are governed by tight caps on non-economic damages under Michigan tort reform laws enacted in the 1990s. It was also difficult to explore the extent of the hospitals' roles in the Fata scheme in discovery for the litigation, due to federal privacy and other laws that govern health providers, he said.
"It's the best deal that could be reached under, frankly, the shackles of what we have to work with in this state," Olsman said. "Is this the most equitable result or deal for his patients? No. But it's the best possible result."
An arbitrator is expected to begin dividing the settlement sum among the patients in September or October.
The 43 Oakland patients are also asking U.S. District Judge Paul Borman to set aside some of the more than $10 million that federal officials have seized or expect to recover in Fata's criminal case, to cover "out-of-pocket" expenses of victims. The U.S. Attorney's office in Detroit opposes the request, arguing Medicare is entitled to recoup what it paid Fata's practice and the patients are trying for a "windfall" at Medicare's expense. Borman has yet to rule on that request.
