More questions raised about county’s oversight of UMC

By Marshall Allen, Tony Cook

Tuesday, Feb. 27, 2007 | 7:03 a.m.

When Clark County commissioners awarded a controversial $5 million University Medical Center cardiology contract to Nevada Heart and Vascular, they were not aware of the group's involvement in an alleged Medicare fraud scheme.

And though the charges are just that - allegations yet to be proved in court - the fact that the commissioners were unaware of them while twice voting for the UMC contract raises further questions about the depth of their oversight of the troubled hospital.

Dr. William Resh, Nevada Heart and Vascular's managing partner, is one of six Nevada doctors named in a civil complaint filed in March by the U.S. attorney's office.

The complaint alleges that the doctors filed false claims and took kickbacks from California-based SDI Future Health Inc. in return for giving company representatives free access to clinics, patients and medical files. The doctors face fines of $5,000 to $11,000 per false claim.

SDI faces criminal charges in the case. In March 2005 a grand jury indictment of SDI listed 124 false claims and additional counts of conspiracy and tax evasion.

Federal prosecutors claim that SDI representatives posed as employees of the individual doctors and then performed unnecessary sleep studies for the purpose of falsely billing Medicare and insurance companies. Doctors and patients were not aware of SDI's intent to fraudulently bill for the services, court documents say.

The civil case is on hold until the criminal matter is resolved.

Stan Parry, attorney for Nevada Heart and Vascular, contends SDI deceived the doctors. The physicians did nothing wrong and the civil complaint is exaggerated, he said.

"There was no kickback scheme or scheme to participate in fraud with SDI," Parry said.

The other Las Vegas physicians named in the civil complaint are Drs. William Curley, Ivan Goldsmith, Joel Lubritz, Adelaida Rusuello and Stephen Seldon.

UMC's contract with Nevada Heart and Vascular has been the subject of significant controversy, in part because another qualified group sought the work at the financially struggling public hospital for $1 million less annually.

The contract was initially awarded in December, with Commissioner Yvonne Atkinson Gates voting for it despite a conflict of interest stemming from her bid to build a custom home for one of the cardiologists in Resh's group. Commissioners reconsidered the contract Feb. 4, with Atkinson Gates this time abstaining, and again awarded it to Nevada Heart and Vascular.

Kathy Silver, UMC's interim chief executive, said she did not learn about the civil complaint naming Resh and his group until Feb. 3, the day before commissioners reconsidered the contract. Resh told Silver about the U.S. attorney's complaint so that she would know about it in the event the competing cardiology group raised the subject, she said.

Silver said she decided not to tell commissioners about the alleged fraud, but Resh's attorney was prepared to give an explanation if the topic came up at the commission meeting.

In hindsight, she said commissioners should have at least known about the allegations.

"I think we would have liked to make commissioners aware it was an issue out there," she said.

Through its credentialing process, the hospital has processes in place to detect any clinical concerns about doctors, such as whether they have been suspended or terminated from a hospital or whether they have been convicted of malpractice, she said.

But UMC does not screen for pending criminal complaints like the one against SDI or for ongoing civil suits like the one that names Resh, Silver said.

Even so, Silver said she believes the current screening process is adequate. "Anybody can sue at any time for any purpose," Silver said. "Our concern would be more with convictions rather than complaints."

Commissioner Bruce Woodbury, who voted for the cardiology contract, said he does not know whether being aware of the civil complaint in advance would have altered his decision. But he should have been told about it, he said.

"It sounds like something I would be concerned about," he said. "Our hospital should be aware of any complaints against any doctors. If they are not, they should be."

Commissioner Chris Giunchigliani, who voted against the contract, agreed. "We should be made aware," she said. "Those are standard things you should take a look at."

The commissioners' oversight of UMC already has been called into question by, among other things, the way in which they allowed since-ousted Chief Executive Lacy Thomas to get away with failing to file required monthly financial statements throughout most of last year. When an outside audit last month finally gave commissioners a look at the hospital's finances, they learned that UMC had lost $34 million in fiscal 2006, not the $19 million Thomas had been telling them.

Other oversight failures include: