St. Joseph Reaches Settlement With U.s.

Investigation Involved Hospital's Dealings With Midatlantic Cardiovascular

July 24, 2009|By Robert Little | Robert Little,

St. Joseph Medical Center in Towson has reached an "agreement in principle" with the federal government to settle any claims that might arise in a long-running investigation of the hospital's relationship with its dominant cardiology practice, hospital officials said yesterday.

Details of the agreement, which is expected to include a monetary penalty, were not disclosed. But interim CEO Robert Lovell began telling employees about the deal Thursday and released a statement later in the day saying that the agreement has been forwarded by U.S. Attorney Rod J. Rosenstein to the Justice Department and other federal agencies for final approval, which could take several months. A spokeswoman for Rosenstein's office declined to comment.

"We reached this agreement without admitting liability in order to avoid the expense and uncertainty of litigation and to allow the hospital to move forward," Lovell said in his message to employees. The agreement has also been approved by the hospital's board of directors and the leadership of Catholic Health Initiatives, its parent corporation.

St. Joseph's executives have said little about the scope and subject of the probe since subpoenas were issued in June 2008. Until Thursday, they had not acknowledged that the investigation involved the hospital's dealings with MidAtlantic Cardiovascular Associates, the dominant cardiology practice in the Baltimore suburbs.

The investigation has been handled by the U.S. Department of Health and Human Service's inspector general's office, which is responsible for investigating Medicare fraud and other health law violations.

St. Joseph's officials said they expect to begin discussions with the agency over whether it will impose a written agreement, usually lasting three to five years, designed to "help ensure that all conduct and activity going forward is unquestionable in its compliance with regulations governing health care."

In February, three of St. Joseph's top executives left their jobs because of the investigation, and all three subsequently resigned.

The relationship between the hospital and MidAtlantic has been a contentious one, spawning several lawsuits and allegations that decisions about patient care were sometimes guided by financial relationships between cardiologists and surgeons. As the dispute escalated, revenue from cardiac surgery at St. Joseph declined while revenue rose at rival Union Memorial Hospital, which was also issued a subpoena in the federal investigation.

A call to MidAtlantic's spokeswoman seeking comment Thursday was not returned.

Last year, St. Joseph hired away two of MidAtlantic's top doctors, derailing the physician group's $25 million deal to be acquired by Union Memorial's parent company, MedStar Health. In December, St. Joseph opened a new heart-catheterization suite under the direction of one of those physicians, Dr Mark G. Midei.

Yesterday, the hospital said Midei, a cardiologist who is among St. Joseph's most prominent clinicians, "is not available for scheduling procedures." He has been unavailable at the hospital for several weeks and could not be reached for comment yesterday. A spokeswoman for the hospital said she could not discuss Midei's status or say when or if he expects to return, calling it a personnel matter.

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