Friday, November 18, 2005


Another triumph of regulation in California: The regulators could not even find enough evidence to put before a court, let alone get any convictions. Persecuting law-abiding people is SO much easier than catching crooks. And note how lucrative it was to be a "whistleblower" (false accuser). Whistleblowers should certainly be protected but rewarding them with huge sums is an open invitation to fraud

"After three years of investigation, the federal government said Tuesday it could not gather enough evidence to warrant criminal charges against any of the doctors in the Redding Medical Center heart surgery case. Instead, federal officials announced they had agreed on a series of multimillion-dollar civil penalties against four doctors accused of performing unnecessary heart procedures and surgeries at the hospital.

The deal marked an anticlimactic end to a probe that began Oct. 30, 2002, when FBI agents raided medical offices in Redding and carted off boxes of documents in an effort to prove widespread medical fraud. Civil penalties and settlements are expected to top $506.5 million, U.S. Attorney McGregor Scott said in a news conference at his office in Sacramento. In addition, two of the doctors - heart surgeon Fidel Realyvasquez Jr. and cardiologist Chae Hyun Moon - agreed never again to perform procedures or surgeries on patients covered by Medicare, Medi-Cal or TRICARE military insurance.

But Scott conceded that while FBI investigators had pressed for charges to be filed, lawyers in his office and at the Justice Department in Washington, D.C., had concluded a case could not be proven against the doctors. "The question at the end of the day becomes, 'Can you convict?' " Scott said. "We came to the conclusion that we could not in good conscience go forward."

Lawyers for the doctors accused in the case, however, said the settlement proved that there was no evidence of wrongdoing by the physicians, who before the FBI raid were highly respected in the Redding area. "The government simply got it wrong," said Malcolm Segal, an attorney for Realyvasquez....

Federal officials characterized the settlement as the best resolution possible after an investigation that included years of federal grand jury probing and a U.S. Senate investigation.... The 57-year-old Realyvasquez was accused along with three others of performing unnecessary procedures and then billing government health care insurance programs. Under the settlement, he will pay $1.4 million in penalties and his insurance company will pay its full limit for victims. The total insurance payout will total $24 million for Realyvasquez; cardiologist Moon, 58; heart surgeon Kent Brusett, 46; and Dr. Ricardo Javier Moreno-Cabral...

Moon attorney James Brosnahan said the settlement was a "reasonable" outcome because the case would have been too costly to defend against. Matthew Jacobs, another attorney for Moon, described the matter as "a tragedy for Dr. Moon. He was a highly skilled, very able and caring physician." ...

To date, more than $400 million in settlements have been approved in cases filed against the doctors and Tenet Healthcare Corp., the firm that owned Redding Medical Center at the time. An agreement with prosecutors in 2003 allowed Tenet to escape criminal charges in exchange for a $54 million payment and a later agreement to sell the hospital. As part of Tuesday's deal, Tenet agreed to pay an additional $5.5 million to the federal government and to pay $1 million to the California Department of Insurance and two whistle-blowers involved in tipping off authorities to the case.

The settlement concludes a dispute over how to pay off three whistle-blowers who had tipped authorities to the procedures at the hospital. Two men - former Redding resident Rev. John Corapi and a friend, Las Vegas accountant Joseph Zerga - were the first to tip authorities and will each receive $2.7 million. A third man, Redding internist Dr. Patrick Campbell, filed his claim as a whistle-blower three days after Zerga and Corapi and will be paid $4.4 million."

More here


For greatest efficiency, lowest cost and maximum choice, ALL hospitals and health insurance schemes should be privately owned and run -- with government-paid vouchers for the very poor and minimal regulation. Both Australia and Sweden have large private sector health systems with government reimbursement for privately-provided services so can a purely private system with some level of government reimbursement or insurance for the poor be so hard to do?

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