Former Sacred Heart physician gets 2 years for role in kickback scheme

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Venkateswara Kuchipudi, MD, was sentenced Friday to two years in prison for his involvement in a kickback scheme at now shuttered Sacred Heart Hospital in Chicago, according to the Chicago Tribune.

Dr. Kuchipudi was arrested along with other former Sacred Heart physicians and executives in 2013 for their alleged involvement in a multifaceted Medicare fraud scheme. Physicians, including Dr. Kuchipudi, were allegedly paid hundreds of thousands of dollars in kickbacks for referrals to Sacred Heart.

After the arrests, CMS suspended its reimbursements to Sacred Heart, and the hospital closed in July 2013. Authorities subsequently dropped the charges against Dr. Kuchipudi in September 2013. However, six months later, he was indicted by a federal grand jury.

A federal affidavit identified Dr. Kuchipudi as one of Sacred Heart's most prolific sources of patients. Sacred Heart administrators referred to Dr. Kuchipudi as the "king of nursing homes" for the number of elderly patients he referred to the hospital, according to the report.

Dr. Kuchipudi is the 10th defendant convicted for his role in the scheme. The hospital's owner and CEO Edward Novak, former CFO Roy Payawal, and former COO Clarence Nagelvoort, were convicted for their participation in the scheme last March. Mr. Novak was sentenced to 4.5 years in prison and ordered to forfeit $10.4 million. Mr. Nagelvoort received a prison term of 21 months, and Mr. Payawal was sentenced to one year in prison.

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