Whistleblower to Receive $1.9 Million in All Children’s Hospital $7 Million Whistleblower Lawsuit By Tod Aronovitz | 04/21/14 | 0 Comment

All Children’s Hospital has agreed to settle a $7 million whistleblower lawsuit for allegedly paying its doctors inappropriately high salaries in return for referrals to the St. Petersburg-based facility, according to an Associated Press article.

The whistleblower in the case, Barbara Schubert, claimed the hospital overpaid doctors by millions of dollars and infringed on the laws that regulate the financial relationship between hospitals and referring physicians. She accused All Children’s of violating the Stark Law, the federal Ethics in Patient Referrals Act, which prohibits compensation that benefits doctors for referring patients using Medicare and Medicaid.

She also alleged that former hospital CEO Gary Carnes and former vice president of strategic business services Bill Horton more than doubled their salaries as a result of their physician hiring practices.

During the time of her allegations, the Bradenton resident was the director of operations for the doctors’ practice at the hospital. She filed her lawsuit in 2011 and left the hospital the same year, after more than a decade of employment there.

Among Schubert’s revelations, reported in an April 17 Tampa Bay Times article, were a “hiring spree” and practices that included doctors receiving “significant bonuses based on the number of procedures performed.”

In addition, All Children’s supposedly offered some physicians “hundreds of thousands of dollars in bonuses and perks, bought out private medical practices, and overpaid new recruits,” in order to boost its referrals and revenues, given that growing local competition had diminished Medicaid patient referrals to All Children’s.

According to a 2010 All Children’s annual report cited in the suit, 70 percent of its patient care revenues, or $370 million, came from Medicaid. That same year as the annual report—2010—All Children’s Hospital officially opened a new $400 million building. Schubert’s lawsuit linked that project to the need for the hospital to increase revenues.

The article also said that Schubert developed a market-based pay scale for physicians based on national norms and physicians’ experience as part of her job. The whistleblower lawsuit showed how far improper hiring practices went by providing information that showed a pediatric surgeon’s base salary was set at $600,000 when the fair market value for a comparable doctor was closer to $350,000.

By the third year of implementing these practices, “some 80 physicians in 10 specialties” had been hired with exclusivity agreements and financial incentives to keep their referrals within All Children’s,” the whistleblower lawsuit said.

All Children’s Hospital has denied any wrongdoing in agreeing to the whistleblower lawsuit settlement.

The hospital will pay the federal government $4 million and the state of Florida $3 million. Schubert will receive $1.9 million.

How to Report Miami Medicare Fraud

Healthcare professionals or medical billing employees who have knowledge of questionable Medicare billing practices can file a confidential legal claim under the False Claims Act. By acting as a “whistleblower” in what is known as a qui tam lawsuit, a private party may collect between 10 to 30 percent of the amount recovered, depending on how the case is prosecuted.

ARONOVITZ LAW: Miami Whistleblower / Qui Tam Law Firm

The Miami Qui Tam law firm of ARONOVITZ LAW routinely works with whistleblowers to document Medicare fraud and other forms of fraud against the government. Contact Miami Whistleblower / Qui Tam lawyer Tod Aronovitz to discuss your case.