8 Recent Legislative and Legal Developments Involving Hospitals

The following legislative developments, lawsuits or settlements involving healthcare providers were reported within the last two weeks, beginning with the most recent.

1. 14th Physician Pleads Guilty to Taking Bribes in $100M Fraud Scheme
A pediatrician with two offices in New York admitted he accepted bribes in exchange for test referrals as part of a long-running fraud scheme operated by Parsippany, N.J.-based Biodiagnostic Laboratory Services.

2. California Medical Malpractice Damages Initiative Gets One Step Closer to the Ballot
Consumer Watchdog and bereaved parents who lost two children to medical negligence turned in 840,000 signatures to get an initiative on California's November ballot  that would raise the $250,000 state cap on noneconomic damages to more than $1 million.

3. Connecticut Hospitals Converting From Nonprofit to For-Profit Could Face More Regulations
Two Connecticut bills seek to further regulate the process of hospitals converting from nonprofit to for-profit status. Senate Bill 460 and House Bill 5571 would create more stringent requirements for the regulatory approval process and give the state's attorney more authority in approving conversions.

4. Valley Heart Consultants Settle False Claims Allegations for $3.9M
McAllen, Texas-based Valley Heart Consultants agreed to pay $3.9 million to settle a suit alleging violations of the False Claims Act. The lawsuit alleged from Jan. 1, 2004, to Sept. 2010, two physicians at VHC violated the False Claims Act by billing Medicare for nuclear stress tests and physical examinations which were allegedly substandard. Many of the nuclear stress tests were allegedly unnecessary as well as many of the coronary angiographies, echocardiograms and carotid doppler studies which were all billed to Medicare.

5. Maryland Birth Injury Fund May Help Hospitals Stay Out of Court
Lawmakers in Maryland are considering creating a no-fault birth injury fund that would allow parents of babies injured at birth to seek compensation from an established state fund rather than pursuing their claims in court against hospitals and physicians.

6. Florida Supreme Court: Injury-Causing Defendant Also Responsible for Malpractice Injuries From Needed Medical Treatment
The Florida Supreme Court signed off on an amendment to the state's standard jury instructions specifying a defendant who caused an injury is responsible for additional injury caused by reasonable obtained medical care or treatment.

7. Stanford Hospital Reaches $4.1M Tentative Settlement in Data Breach Case
Stanford (Calif.) Hospital & Clinics and one of its former contractors entered into a tentative settlement to pay $4.1 million to settle a class-action suit alleging the hospital violated state privacy law by allowing the protected health information of 20,000 emergency department patients to be posted online for nearly a year.

8. Duke Health Reaches $1M Settlement in Fraudulent Billing Case
Durham, N.C.-based Duke University Health System agreed to pay $1 million to resolve False Claims Act allegations. The lawsuit against Duke Health alleged the health system billed the government for services provided by physician assistants during coronary artery bypass surgeries when the PAs were acting as surgical assistants, which is not allowed under government regulations.

More Articles on Legal Issues Involving Hospitals:

Guilty Verdicts Revived in Kickback Case
OIG: Medicaid Fraud Control Units Recovered $2.5B in 2013

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