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Hospital Medicare Fraud


Chicago Hospital Medicare Fraud Case Now on Trial

Sacred Heart Hospital in Chicago is in the midst of a  racketeering trial that could result in a major it to its reputation, as well as a large award to the whistleblowers who uncovered the alleged fraud in the first place.

At the heart of the trial are two families, both of whom lost loved ones at the hospital, and who claim that hospital administrators routinely scheduled and performed surgeries that were medically unnecessary and occasionally dangerous, with the aim of maximizing payouts from Medicaid and Medicare.

Those two families apparently have a lot of company. According to reports, a great many elderly and poor patients were “recruited” by  the hospital, which was often described as “substandard” and even “maggot-infested” in some reports.

In 2013, the U.S. Department of Justice brought charges of felony healthcare fraud against 11 Sacred Heart administrators and physicians, after which Medicare officials suspended payments to them and the hospital shut down. By the time of its closing, they had fewer than ten patients, in part because doctors refused to admit patients for fear of taking a hit to their reputation.

Many of those charged in 2013 have pleaded guilty, and some are talking about their experience with a for-profit hospital that obviously placed profits ahead of patient care. One “patient recruiter” for the company claims the owner and the administrators set up “patient recruitment quotas” and if there were empty beds, they would even call up former patients and ask them if they were sick again. Sometimes, a patient would say yes, and they would send a hospital van to bring them in.

Sacred Heart also liked to bribe nursing home facilities to allow them to conduct “free health screenings” to meet their quota that way. They paid ambulance drivers to sometimes drive patients all the way through the city of Chicago. To do so, they developed certain codes to make the patients a “direct admit,” which allowed the ambulance to take critically ill patients to Sacred Heart, even as they passed by a number of hospitals that were better and closer.

Most cases the Department of Justice brings forth under the False Claims Act are brought because whistleblowers bring them information, and the Sacred Heart Medicare and Medicaid fraud case is no exception. This case could result in millions of dollars in restitution for the government, and when they win, these whistleblowers may be entitled to compensation from that fund. Quite often, these awards run into the millions.


Commercial Litigation, False Claims Act