Whistle-blower files suit over alleged double-booked surgeries

Whistleblower Articles, Whistleblower News

By and
The Boston Globe

Orthopedic surgeons at Massachusetts General Hospital repeatedly kept patients waiting under anesthesia longer — sometimes more than an hour longer — than was medically necessary or safe, as they juggled two or even three simultaneous operations, according to a federal lawsuit that alleges frequent billing fraud at the prestigious hospital.

Dr. Lisa Wollman, a former anesthesiologist at Mass. General, alleges in the lawsuit that at least five surgeons endangered patients by regularly performing simultaneous surgeries. Wollman charges that the doctors also defrauded the government by submitting bills for surgeries in which they were not in the operating room for critical portions of procedures, leaving the work to unsupervised trainees.

Wollman said she witnessed surgeons performing simultaneous operations repeatedly from 2010 to 2015, when she left MGH for New England Baptist Hospital. She said hospital policy gave the doctors financial incentives to do more procedures, and they never told patients they would be going back and forth between operating rooms.

“This often meant an unwitting patient was left fully anesthetized — unconscious, paralyzed, intubated, dependent on a ventilator to breathe — for longer than medically necessary, often in the care of trainees, without the backup of a properly qualified surgeon, despite legal requirements,’’ said the suit filed Wednesday in US District Court in Boston.

Mass. General has previously disputed the validity and importance of virtually every complaint about surgeries that overlap, saying there’s no evidence any patients have been harmed. On Wednesday, Mass. General released a statement defending its approach to surgery: “The MGH continues to believe that its practices comply with all applicable laws and regulations, and the hospital will defend the claims accordingly.”

The lawsuit is believed to be the first filed by an MGH physician in the wake of a controversy that roiled Mass. General for years and prompted a national debate over safe surgical practices. Though many surgeons schedule operations to overlap by a few minutes — letting trainees close the surgical wound of the first operation while the surgeon moves on to the second — the debate at Mass. General focused on surgeries that overlapped for much longer.

There’s been relatively little research into the safety of simultaneous surgery, though a University of Virginia researcher found no increase in complications in operations that overlapped by up to 45 minutes. The American College of Surgeons last year issued its first-ever guidelines saying the practice is broadly permissible, within limits, but that “the patient needs to know” whenever a doctor runs more than one operating room at a time.

Wollman listed 16 dates from 2011 to 2013 when five orthopedic surgeons performed at least two operations simultaneously for hours. In every case, the suit said, patients lay under anesthesia longer than was warranted, increasing the risk of complications and inflating anesthesia charges.

Many of the allegations in the 54-page complaint were reported by The Boston Globe Spotlight Team in October 2015 in the first in a series of stories about the double-booking at MGH and other teaching hospitals. Wollman was among several doctors who criticized the practice to hospital leaders in meetings and in e-mails later obtained by the Globe.

The hospital dismissed the orthopedic surgeon who led the opposition to double-booked surgeries, Dr. Dennis Burke, for allegedly violating hospital policy by providing the Globe with internal records. Burke argued that he was fired for blowing the whistle on double-booking.

Wollman’s lead attorney, Reuben Guttman of Washington, D.C., argues that the doctors violated rules for two government health insurance programs, Medicare and Medicaid, which require surgeons to be present for all “critical portions” of an operation in order to get paid. If surgeons weren’t present and billed the insurers without making their role clear, it could constitute billing fraud, though the rule has seldom been enforced.

Wollman initially filed the lawsuit under seal in May 2015. It was recently unsealed after Carmen M. Ortiz, who was US attorney at the time, and state Attorney General Maura Healey declined to join the suit as plaintiffs. Wollman filed a revised version of the suit Wednesday, telling the Globe in a statement released by her lawyer that she decided to pursue it without government help because she wants to end a practice “based on deception and driven by economic benefit.”

“I am pursuing this case because my ethical obligation is to patients — past, current, and future — who are unknowingly scheduled for concurrent surgeries,” said Wollman, who worked at Mass. General, Harvard’s largest teaching hospital, for more than 20 years.

Both the US attorney’s office and Healey’s office declined to comment on Wollman’s suit.

The lawsuit, which names MGH and its parent company, Partners HealthCare System, as defendants, uses pseudonyms for five orthopedic surgeons who allegedly supervised simultaneous surgeries and, in Wollman’s view, defrauded the federal and state governments in the Medicare and Medicaid programs. But the Globe was able to identify several of the surgeons based on earlier reporting.

One of the surgeons appears to be Dr. Jon J.P. Warner, chief of MGH’s shoulder service and the highest compensated employee at the hospital about a decade ago, earning just over $2.1 million one year, according to financial documents filed by the hospital. Wollman’s suit said Warner, identified only as “Surgeon A” in the lawsuit, regularly booked two simultaneous operations in the morning and two in the afternoon.

One morning in October 2011, the suit said, a 65-year-old patient on blood pressure medication waited under anesthesia for a full 90 minutes before Surgeon A arrived from another operating room to start the patient’s surgery. The suit said Surgeon A had scheduled the two long shoulder operations to start within 15 minutes of each other.

Yet, the suit said, Warner wrote on the patient’s operative note that he participated in the entire surgery. Wollman complained to hospital officials at the time, the suit said, and Warner corrected his report.

On another occasion, one of Warner’s patients lay waiting for him anesthetized when a second surgical patient asked Wollman if she could see Warner, the suit said. It turned out that Warner was in another building on the MGH campus seeing other patients, the suit alleges.

Warner, described by the hospital as one of the nation’s foremost shoulder surgeons, could not be reached, but in the past has declined to discuss specific cases to protect patient privacy.

In general, Warner wrote in a 2015 statement to the Globe, “The suggestion that I am not managing all my patients’ care while they are in the operating room is both untrue and malicious.”

Warner noted he always performs the key components of surgery and that fellows occasionally do “noncritical activities,” such as positioning and making the initial incision.

Wollman said another doctor, identified as Surgeon B, “never appeared in the room” for an April 2013 operation when he was supposed to be the attending physician and she provided the anesthesia. Based on e-mails cited in the lawsuit that are identical to ones obtained by the Globe, Surgeon B appears to be Dr. Malcolm Smith.

Wollman said the patient suffered a serious and sudden constriction of the airways while Surgeon B was not present, though a senior trainee was. The lawsuit said that Wollman complained to the operating room director about Surgeon B’s absence, writing, “Isn’t he obligated to be there?”

But Wollman said senior medical officials at Mass. General did not follow up on her concerns “except to threaten her by saying that she had violated patient privacy and could face legal action.”

Smith could not be reached for comment, but he has previously said he did nothing improper and declined to comment on individual cases. In 2015, he told the Globe in a statement that allegations that he did not take proper care of his patients were based on “innuendo, incomplete and inaccurate data.”

But Wollman claims that incidents like the one involving Surgeon B both were frequent and continued long after the hospital placed more limits on overlapping surgeries in 2012.

“The practice of billing for unreasonable and unnecessary anesthesia was not a remote occurrence” among orthopedic surgeons, the suit says. “Rather, it was commonplace and a direct outgrowth of the concurrent surgery practice which, to succeed, required patients to be put under general anesthesia waiting for their surgeon to arrive.”

Guttman, Wollman’s attorney, said it was premature to talk about the damages if Mass. General is found to have improperly billed Medicaid and Medicare, but the costs could be considerable. The law calls for treble damages and Mass. General could face an additional penalty of at least $5,000 for each instance of improper billing, Guttman said. If Wollman prevails, he added, she could potentially receive 25 percent to 30 percent of any money recovered under the False Claims Act.

cf  www.bostonglobe.com

Democracy Misconceived

Whistleblower Articles, Whistleblower News

By William Nettles and Reuben Guttman

There is a misconception among many that democracy and freedom are synonymous and that freedom, in turn, equates to the right to do and say anything.

The White House recently issued an Executive Order and a Memorandum setting a course toward deregulation; this misconception may explain why initiation of plans for the scrapping of rules – actually promulgated pursuant to laws passed by Congress — may seem as American as the Boston Tea Party. Yet, merely having the optics of consistency with American values does not mean that the President’s plans are – in truth – consistent with our sacred rule of law.

Read the full article here.

Marijuana, Immigration And Private Prisons

Whistleblower Articles, Whistleblower News

On August 18, 2016, then Deputy Attorney General, Sally Yates, issued a memorandum directing the Bureau of Prisons (BOP) to begin to reduce – with an eye toward eliminating – the use of private prisons. Yates directed “that, as each contract reaches the end of its term, the Bureau should either decline to renew the contract or substantially reduce its scope in a manner consistent with law and the overall declines in the Bureau’s inmate population.”

Of course, when the Deputy Attorney General wrote that memo, DOJ was not in the mode of targeting enforcement of Marijuana laws or rounding up “illegal immigrants.”

Read the entire article here.

Book: United States ex rel. Rodriguez v. Hughes, et al., Relators Version

Paul Zwier Articles, Reuben Guttman Articles, Whistleblower News

US ex rel Rodriguez v Hughes et alby Paul J. Zwier, Reuben Guttman, Matthew J. McCoyd, Alexander G. Barney

The three case files of United States ex rel. Rodriguez v. Hughes, et al.… explore the suit brought by Juan Rodriguez, a prominent engineer, who acted as a whistleblower against his employer, Hughes Aircraft, for violations of the False Claims Act.

Richard Hughes (CEO of Hughes Aircraft) learned that the United States Department of Defense (DOD) was looking for a new helicopter to provide to the Mexican government as part of the United States’ Mérida Initiative, which provided Mexico resources to help it fight its war against the drug cartels. Hughes, on behalf of Hughes Aircraft, entered into a sole source contract with the DOD. Hughes was favorably positioned to do so as it was the sole manufacturer of the Screaming Eagle helicopter S-70, the model the DOD was seeking to purchase.

Rodriguez’s employment background put him in a position to ascertain whether his employer, Hughes Aircraft, was making false claims to the DOD. Initially, Rodriguez had been employed at Sikorsky Aircraft Inc., a predecessor of Hughes, working in the design and manufacture of the first Screaming Eagle helicopters. Later Sikorsky Aircraft was bought by Hughes Aircraft. During his tenure at Hughes, Rodriguez had designed and retrofitted early versions of the Screaming Eagle helicopter. When retrofitted with heavy missiles, one of the first versions, the UH-A, suffered cracks on landing. Accordingly, metals intended to help crash-proof the helicopter were added to the design. Hughes also started to employ Magnaflux testing to ensure that later versions of the Screaming Eagle did not have subsurface cracks.

Rodriguez claims that he saw cracks in the cabin of one of the Screaming Eagles Mexico helicopters, and that he also saw workers welding over the cracks. Rodriguez claimed that he considered the welding over of cracks in the cabin of the Screaming Eagle a “cover up” of the failure to conduct testing and thus an act of fraud—passing on defective helicopters to the governments of the United States and Mexico.

Available on line at Barnes & Noble.

Corporate Compliance Programs: Pretext or Panacea?

Justin Brooks Articles, Whistleblower Articles, Whistleblower News, Whistleblowers Blog

Proponents of corporate compliance programs loudly sing their praises while detractors point to ceaseless prosecutions and a parade of civil suits—often resulting in multi-billion dollar verdicts or settlements—as evidence that they are ineffective. So, are corporate compliance programs a panacea or a pretext? The truth lies somewhere in between.

As a threshold issue, corporations are for-profit institutions. Indeed, most corporations have a mandate to maximize profit for shareholders. This can encourage senior management to operate in grey areas, and regulators may later deem their actions (and board oversight of such actions) to violate a wide array of laws. Second, formalistic compliance programs are not enough to ensure internal reporting of potential fraud and are not enough to inspire companies to take appropriate corrective actions. Instead, as set forth below, companies must take steps to ensure effective implementation of compliance programs and foster a culture of corporate compliance.

The countervailing factors that motivate officers and directors to engage in or acquiesce to fraudulent conduct or, alternatively, devise and implement an effective compliance program warrant in-depth treatment in a standalone piece. Here, I turn to answering the specific questions posed with these general principles in mind.

Question 1: Do corporate compliance programs actually suppress information from regulatory oversight?

Response: Yes, often appropriately. But meritorious—and sometimes non-meritorious—allegations of misconduct tend to get reported externally where internal responses are inadequate or the company has not created a culture of compliance and reporting.

Recent reports, compiled through surveys of hundreds of senior executives from a broad range of industries, indicate that roughly two-thirds of United States companies are affected by fraud. 1 Costs to companies, including reputational damage, can be substantial as can costs associated with remediation and investigation of fraudulent practices.

Internal reporting programs such as corporate compliance hotlines represent a company’s first line of defense against corporate fraud. Internal whistleblower hotlines are a key component of a company’s anti-fraud program: where such hotlines are implemented, tips are typically the most common method of detecting fraud. 2 Moreover, the Sarbanes-Oxley Act (“SOX”), international guidelines from the European Union, and the U.S. Federal Sentencing Guidelines have deemed hotline reporting programs a good and necessary business practice. At the same time, internal compliance hotlines serve to screen out frivolous and baseless claims.

In my experience counseling and defending large corporations on employment matters and corporate compliance, reports to company ombudsman, managers, or human resources and compliance personnel often lack merit or do not implicate fraud. Employees often file malicious or fictitious complaints against fellow employees or the organization to ward off pending termination or to seek revenge for perceived slights. But treating employees with respect, even in these situations, can dissuade employees from unwarranted external reports.

Unfortunately, despite strong incentives to self-report credible evidence of wrongdoing, companies may conceal such evidence. Like companies, whistleblowers have incentives under various statutory regimes to report internally. For example, under the SEC whistleblower program established by the Dodd–Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank”) in 2010, a whistleblower’s participation in internal compliance systems will generally increase an award and interference with or bypass of those systems can decrease an award. 3A whistleblower who reports conduct to the SEC within 120 days of reporting internally will also receive credit for any information the company later self-reports to the SEC. 4

In our experience, external reporting typically follows internal reporting when an employee felt the company response was not adequate. As of 2014, 80% of company insiders who reported potential misconduct to the SEC first raised their concerns internally to compliance personnel or their supervisors. 5 Likewise, Guttman, Buschner & Brooks attorneys have represented countless whistleblowers bringing cases under the False Claims Act and have helped recover billions of dollars on behalf of federal and state governments. In our experience, these whistleblowers typically reported internally first and only sought representation after the company responded inadequately or dismissed concerns as “this is the way we do business.” Thus, while corporate compliance hotlines and related reporting mechanisms serve as the first line of defense against fraud, the False Claims Act, Dodd-Frank and other whistleblower protection statutes effectively incentive employees to report fraud externally when a company’s response has been ineffective or where a company has not created a culture where employees feel comfortable reporting misconduct internally.

Companies are most likely to dissuade external reporting by creating and implementing effective compliance programs as well as self-reporting credible allegations of misconduct. Such self-reporting may also result in cooperation credit. Indeed, on September 9, 2015, Deputy Attorney General Sally Yates issued a memo instructing the DOJ to seek individual accountability from individuals perpetrating wrongdoing in the course of fighting corporate fraud and misconduct. 6 The memo was sent to every United States Attorney, the Assistant Attorney General heading up each DOJ division, the Director of the Executive Office for United States Trustees, and the Director of the FBI.

Consistent with the Yates directives, we have seen renewed focus on individual accountability in the False Claims Act cases we have litigated alongside the government over the past year. This has manifested in the government’s decision to name individual executives as defendants in complaints in intervention, the structure of settlements, and a myriad of other ways.

In keeping with its renewed focus on individual liability, the Yates memo articulated several changes to DOJ policy regarding the definition of “cooperation credit” for corporations. These changes are applicable to criminal as well as civil enforcement matters. Corporations historically have received and continue to receive more favorable settlement terms when the government concludes they provided material cooperation with respect to a government investigation. But companies have struggled to understand what it means to “cooperate” in a post-Yates world.

In a September 27, 2016 speech, Principal Deputy Associate Attorney General Bill Baer provided some insight as to what such cooperation now entails, highlighting the importance of prompt and material assistance. 7 Merely responding to a subpoena or civil investigative demand (“CID”) will not qualify as cooperation. Rather, a company hoping to obtain cooperation credit is expected to provide specific information about any and all employees involved in wrongdoing that is unknown to DOJ and that materially assists in its investigations. Thus, while meritless claims not implicating fraud are properly vetted and disposed of through company screening without ever coming to the attention of government regulators and investigators, an effective compliance program will also develop mechanisms to affirmatively identify and provide material information to regulatory agencies investigating the company.

Question 2: Do corporate compliance programs create an environment where employees are led to believe that wrongdoing in the corporate environment is implausible because a compliance program exists?

Response: No. But implicit or explicit directives from management can lead to false beliefs that particular actions comport with the law.

A corporate compliance program should and generally does sensitize employees to the fact that wrongdoing isplausible. A strong compliance program often identifies the relevant laws applicable to an employees’ day-to-day activities and may include fact patterns the company has identified as violative of relevant laws. For example, compliance training for pharmaceutical sales representatives is likely to and should inform employees that promoting off-label uses of company drugs can be deemed to be a violation of the Federal Food, Drug, and Cosmetic Act and likewise expose the company to liability under the False Claims Act. 8

Having said that, we have represented relators in False Claims Act cases in which company management has been warned by its own third-party regulatory consultants that certain conduct and types of interactions with physicians is proscribed. These companies have nonetheless directed such conduct in business plans, training documents, and other written directives to sales representatives. Similarly, employee performance reviews may—in writing—encourage conduct that is deemed by the government to be unlawful. Managers may also encourage such conduct when accompanying employees on sales detailing visits.

Thus, the existence of written policies and a compliance program does not itself create an environment where employees believe wrongdoing is implausible. But written directives, communications, and training by management can cause employees to believe that particular conduct is appropriate and in conformity with stated company policies and cause them to ignore other signs or evidence that such conduct is—in fact—unlawful.

Question 3: From a practical viewpoint, what kind of corporate compliance programs work better than others?

Response: Corporate compliance programs that incorporate the principles of communication, responsiveness, and transparency

Above all, compliance programs should be transparent and comprehensible to employees (and management), and the goals of enforcement mechanisms should be clearly communicated. Measures also must be implemented to ensure prompt and efficient responses to allegations of corporate wrongdoing. How this manifests will vary from industry to industry and company to company. It largely depends on the service or product a company offers, specific rules and regulations that govern the company, the size and geographic breadth of a company, and a myriad of other factors.

In addition to general principles of communication, responsiveness, and transparency, certain key factors tend to underlie effective compliance programs:

1. Guidelines: companies should have explicit guidelines that instruct employees how to perform their jobs in a legal and ethical manner, including training programs, codes of conduct, and written performance standards.

2. Surveillance: companies should have official policies and procedures that detail the manner in which they will monitor employees and how (and to whom) employees can report wrongdoing.

3. Sticks and Carrots: companies should identify and implement sanctions for wrongdoing as well as rewards in the form of promotions and positive reviews for demonstrated competence and compliance with company guidelines. A program can be well-drafted on paper but useless in practice if a company does not punish misconduct or reward behavior it wishes to incentivize.

4. Leadership: it is not enough to have formal procedures in place to foster compliance. The “water cooler” conversation and conduct of top-level management are equally important. The “tone at the top” and informal communications as set by leadership behavior is critical, but it is equally critical for top management to monitor and instill the same behavioral norms in middle management.

5. Independence of compliance personnel. Local management are rarely trained as investigators, and may be part of the problem. Likewise, local human resources personnel may appear to employees to be aligned with management and unlikely to take employee concerns seriously, disincentivizing employees from raising concerns about potential misconduct. Accordingly, effective compliance programs often provide mechanisms for employees to report concerns to independent third parties (such as ombudsmen) specifically trained in addressing employee concerns. Depending on the nature of the complaint, legal personnel, compliance officers, or human resources personnel may need to become involved after the initial investigation has begun.

Corporate compliance programs play an important role in modern corporate governance. But they are only as good as management’s commitment to effective resolution of employee concerns and implementation of corrective action when credible misconduct has been identified. Companies have strong incentives to get it right.

Footnotes

∗Justin S. Brooks is a founding partner of Guttman, Buschner & Brooks PLLC. Mr. Brooks represents relators in qui tam litigation under the False Claims Act and other federal and state statutes and corporate clients in a wide variety of complex commercial and employment litigation. He also provides employment and compliance counseling to companies, represents institutional investors in shareholder derivative and corporate governance litigation, and represents employees in employment litigation of all types. He has represented clients in claims brought under the Federal False Claims Act, securities laws, the Worker Adjustment and Retraining Notification Act (WARN), Racketeer Influenced and Corrupt Organizations Act (RICO), and various employment discrimination, labor and environmental statutes.Prior to founding the firm, Mr. Brooks worked at Kirkland & Ellis LLP, Morgan, Lewis & Bockius LLP, and Grant & Eisenhofer P.A. He also served as law clerk for a federal judge. He has authored numerous articles on class action litigation and other topics.

1. Kroll, 2013/2014 Global Fraud Report, Who’s Got Something to Hide? 12 (2013), http://www.kroll.com/en-us/global-fraud-report.

2. See, e.g., Ass’n of Certified Fraud Exam’rs, Report to the Nations on Occupational Fraud and Abuse, 2014 Global Fraud Study 19 (2014), https://www.acfe.com/rttn/docs/2014-report-to-nations.pdf.

3. 17 C.F.R. § 240.21F-6(a)(4); 17 C.F.R. § 240.21F-6(b)(3).

4. 17 C.F.R. § 240.21F-4(b)(7).

5. U.S. Sec. & Exch. Comm’n, 2014 Annual Report to Congress on the Dodd-Frank Whistleblower Program 16 (2014), http://www.sec.gov/about/offices/owb/annual-report-2014.pdf.

6 .See Memorandum from the Office of the Deputy Attorney Gen. to the Assistant Attorney Gen., Antitrust Div., the Assistant Attorney Gen., Civil Div., the Assistant Attorney Gen., Criminal Div., the Assistant Attorney Gen., Envtl. and Nat. Res. Div., the Assistant Attorney Gen., Nat’l Sec. Div., the Assistant Attorney Gen., Tax Div., the Dir., Fed. Bureau of Investigation, the Dir., Exec. Office for U.S. Trs., & all U.S. Attorneys (Sept. 9, 2015) https://www.justice.gov/dag/file/769036/download.

7 .See Bill Baer, Principal Deputy Assoc. Attorney Gen., Remarks at Society of Corporate Compliance and Ethics Conference (Sept. 27, 2016) https://www.justice.gov/opa/speech/principal-deputy-associate-attorney-general-bill-baer-delivers-remarks-society-corporate.

8 .The type of conduct that qualifies as “promotion” and the degree to which certain activity may be protected by the First Amendment involve a nuanced assessment, is largely unsettled, and varies from jurisdiction to jurisdiction. Detailed discussion is beyond the scope of this article.

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