Whistleblower client helps government settle $15 million Baylor heart surgery Medicare fraud case 

Working in concert with the federal government for five years, my law firm colleagues and I saw our whistleblower client receive $3 million of the $15 million settlement of a lawsuit alleging that Houston surgeons were letting unqualified trainees perform parts of heart surgeries while the surgeons billed for two or three concurrent surgeries.

The government said it is the largest settlement on record for Medicare fraud over concurrent surgery claims. The settlement is with Baylor St. Luke’s Medical Center, Baylor College of Medicine and Surgical Associates of Texas P.A.

This case is a good example of what qui tam claims under the False Claims Act can do. The allegations in this case became public and got a lot of publicity when the government intervened and settled. It puts people on notice around the country that this type of behavior will risk the wrath of the government.

 “In short, the teaching physicians churned through as many cardiac surgeries as possible to generate revenue for Baylor, regulations be damned, and were rewarded with lavish compensation,” said the lawsuit filed by my firm AZA.

The press release from the U.S. Southern District of Texas’ U.S. Attorney’s Office is here Texas medical center institutions agree to pay $15M record settlement involving concurrent billing claims for critical surgeries.

The False Claims Act was enacted after the Civil War to address military contract fraud. These days it is health care and still some department of defense fraud that dominate use of the act in lawsuits filed by whistleblowers.

This case took five years from when we filed it in 2019, which is not uncommon when the government intervenes and does its own thorough due diligence. The government tends to get involved in cases it deems both important and likely to lead to end in a win for the government. Otherwise, the whistleblower who filed the lawsuit must proceed on their own, even though the government would still take the biggest chunk of any judgment.

In this case, Medicare billing regulations require that a teaching physician must be in the operating room and supervising operations during critical portions of surgeries. Regulations also require adequate informed consent from patients. The lawsuit alleges that procedures were done in violation of these regulations, resulting in a $150 million windfall for the hospital and allowed the surgeons to make compensation up to four times what their colleagues made.

These Medicare regulations are there to protect the integrity of the government program and to protect patients. Patients have a right to a surgeon’s undivided attention, especially in a procedure as important and complicated as heart surgery. We took this case when we saw it concerned not only double and triple billing to Medicare but also something as serious as heart surgeries. The surgeries in question included coronary artery bypass grafts, valve repairs and aortic repair procedures.

The case is in federal court in Houston titled Morgan et al. v. Baylor St. Luke’s Medical Center et al. case number 4:19-cv-02925.    

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