published Saturday, October 15th, 2011

Erlanger, Heart Institute under federal scrutiny


by Chris Carroll
Erlanger Hospital is located on 3rd Street in Chattanooga.
Erlanger Hospital is located on 3rd Street in Chattanooga.
Photo by Angela Lewis /Chattanooga Times Free Press.
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Erlanger Health System officials confirmed Friday they are expecting a subpoena from the U.S. Department of Health and Human Services Office of Inspector General regarding contracts with the Chattanooga Heart Institute.

Doug Fisher, Erlanger's vice president of government and corporate affairs, confirmed the subpoena request in a written statement to the Chattanooga Times Free Press.

"We have little information about this situation but do believe it dates back several years," he said. "The administration has taken very extensive and expensive measures in the compliance area in recent years, and we are very confident that steps are in place to assure that our contracts follow all legal requirements."

Beyond that, federal and hospital officials were not forthcoming. Donald White, a spokesman for the Department of Health and Human Services Office of the Inspector General, declined to discuss details.

"As a matter of investigative procedure, we can neither confirm nor deny operations that may be pending before the agency," he said.

In 2009, Erlanger signed an agreement with Chattanooga Heart Institute, a subsidiary of its main competitor, Memorial Hospital, whose officials declined comment.

The contracts totaled $1.6 million annually to provide 24-7 on-call coverage and interpretation of cardiac test results. Some Erlanger trustees had expressed concern about the cost of the contracts, according to newspaper archives.

Before the agreement, Erlanger struggled to hire cardiologists, blaming the problem on what one official called two "burdensome" factors -- its mission to treat indigent patients and a high number of emergency calls.

It's not the first time federal authorities have looked into Erlanger. In a 2005 settlement that sapped hospital reserves, Erlanger paid $40 million to the U.S. Department of Justice amid allegations that hospital officials violated anti-kickback statutes.

The agreement alleged the hospital overpaid physicians and offered them improper incentives in exchange for referrals to Erlanger. According to the settlement, Erlanger denied the government's allegations.

The 2003 subpoena behind that investigation asked for Erlanger documents dating back to January 1995 and demanded copies of contracts between the hospital and dozens of physicians, records documenting the hours doctors work, minutes of board meetings and conflict of interest disclosure statements, according to newspaper archives.

"Anytime we receive requests for information from the federal government, we are always ready to comply and look forward to resolutions to their questions," Fisher said.

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Comments do not represent the opinions of the Chattanooga Times Free Press, nor does it review every comment. Profanities, slurs and libelous remarks are prohibited. For more information you can view our Terms & Conditions and/or Ethics policy.
joepulitzer said...

WATCH OUT FOR THE TIMES CENSORS. THEY WILL DO YOU JUST LIKE THEY DO THEIR STORIES: CUT OUT WHAT THEY DON'T LIKE. ALL THE NEWS THEY DEEM FIT TO PRINT (OR POST) PATHETIC ....!

October 15, 2011 at 5:01 a.m.
KWVeteran said...

The feds just ought to bug out. Their intervention will amount to bad will towards Erlanger and certainly nothing of any good will come of federal intervention. When has the government ever done anything right?

October 15, 2011 at 8:55 a.m.
rusty7 said...

Why would a pubic hospital be fined 40 million? What kind of sense does that make..?

October 15, 2011 at 9:20 a.m.
Sailorman said...

What kind of sense does it make? None at all. It's just another fed shakedown. Having been the victim several times of these tactics courtesy of Medicare, I've seen that once these crooks find a pot of gold, they keep after it until there's nothing left. It's even worse if you beat them in court. Then they'll be back with a vengeance. That $40 mm would have been better spent by Erlanger than whatever gov blackhole it disappeared into.

October 15, 2011 at 10 a.m.
fechancellor said...

rusty7:

"It's not the first time federal authorities have looked into Erlanger. In a 2005 settlement that sapped hospital reserves, Erlanger paid $40 million to the U.S. Department of Justice amid allegations that hospital officials violated anti-kickback statutes.

The agreement alleged the hospital overpaid physicians and offered them improper incentives in exchange for referrals to Erlanger. According to the settlement, Erlanger denied the government's allegations."

You need not worry, the Erlanger Board will settle for whatever the Feds demand, if only to shield those with individual/collective responsibility from indictments.

October 15, 2011 at 1:56 p.m.
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