It was reported recently that a federal investigation is underway at the Sacred Heart hospital, located on the west side of Chicago. The probe involves allegations of unneeded tracheotomies at the hospital. The FBI says there was a scheme in place to defraud Medicare and Medicaid. Based in part on surreptitious tape recordings, an FBI affidavit lays out allegations that a Sacred Heart pulmonologist kept patients too sedated to breathe on their own, then ordered unneeded tracheotomies for them – enabling the for-profit hospital to reap revenue of as much as $160,000 per case. Tracheotomies are typically used to open an air passage directly to the windpipe for patients who can’t breathe otherwise.
The government has charged Edward Novak, the owner of Sacred Heart, his chief financial officer and five physicians with Medicare fraud in a criminal complaint. It was alleged that they gave or received kickbacks in return for patient referrals. A physician and two Sacred Heart administrators worked with federal investigators, secretly taping conversations with other hospital staff members, according to the complaint.
Sacred Heart is located in a neighborhood with half the median household income and twice the poverty rate of the city overall. The hospital has been filling less than half its 119 beds in recent years, according to reports it files with the Medicare program. It was reported that almost all its customers are Medicare or Medicaid recipients. Still, Novak reported a jump in profit for the hospital to $9.4 million for the year ended June 30, 2012 – up from $1.3 million the previous year.
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