Sacred Heart hospital on Chicago’s west side is now a focal point for federal investigators following alleged Medicare and Medicaid fraud charges. Thus far 6 people have been arrested, including Sacred Heart’s owner and CEO – Edward J. Novak, of Park Ridge, and Sacred Heart’s executive V.P. and CFO – Roy M. Payawal, 64, of Burr Ridge. According to a press release from the U.S. Attorney’s office some of the alleged fraud details are shocking:
“Between January 2010 and February 2013, May allegedly received $74,000 in the form of 37 checks, for $2,000 each, disguised as ‘rental payments’; Moshiri, a podiatrist, allegedly received $86,000 in 38 checks pursuant to a purported contract to teach podiatry students; and Maitra allegedly received $68,000 in 34 checks pursuant to a purported teaching contract – and the $228,000 total in alleged kickbacks were all in exchange for their referral of patients to Sacred Heart, the charges allege.
“In a recorded conversation last month, Maitra allegedly explained to Administrator A that he used to make Novak ‘so much money’ performing almost daily penile implant procedures on patients, but that he no longer performed as many of those procedures because Medicare had decreased its rates of reimbursement for the procedure. Maitra did not comment on whether the patient need for the procedure had somehow changed, according to the affidavit.”
“On March 1, 2013, Administrator A recorded Novak stating that tracheotomies are Sacred Heart’s ‘biggest money maker’ and the hospital can make $160,000 for a tracheotomy if the patient stays 27 days. On March 7, 2013, the Intensive Care Unit case manager told Administrator A that she must often ‘stretch’ a tracheotomy patient’s stay to 28 days to maximize Medicare reimbursements ‘to make Novak happy.’”
Sadly, cases like these are not uncommon in Illinois. In fiscal year 2011, the Department of Health and Human Services reported that in Illinois alone there were:
326 Medicaid fraud investigations
48 were indicted on Medicaid fraud charges
30 were convicted
18 cases of civil settlements/judgments
$47.8 million dollars was recovered in Medicare fraud cases
Until recent legislation was passed in July of 2012, the state of Illinois Medicaid program did not even have a TPA – Third Party Administrator – or other fraud prevention system in place under Rod Blagojevich’s destructive tenure as governor. There was apparently no need for one in Blago’s mind because he was lawless himself. Blago illegally expanded our Illinois Medicaid program to 77,000 illegal aliens – who are still enrolled on our Medicaid program today – and increased the eligibility for one to receive Medicaid to 138% above the Federal poverty level. He did so without our Illinois House or Senate approval.
There is a better way to run Illinois’ Medicaid program. There are proven solutions. They are not new ideas. In fact, if Illinois had emulated Florida’s Medicaid reform program last year, we would have saved $1.1 billion. Or, we could have implemented what former governor Mitch Daniels did to reform Indiana’s Medicaid program. We don’t even need to look to other states for solutions. Our own Jonathan Ingram of the Illinois Policy Institute has penned a recent report that paves the way perfectly for Illinois lawmakers to follow. Will they follow these recommendations? Will Illinois legislators act to protect Illinois’ indigent residents? Or, will they simply auto enroll up to 900,000 more indigent residents – per the President’s health care law – onto a broken, bankrupt, dangerous Medicaid program that is already rationing care? Only time will tell.