A federal judge revised her judgment against Tuomey Healthcare System downward by more than $39 million on Wednesday, one day after awarding the federal government a $276 million against the local hospital. At the same time, lawyers for Tuomey moved forward by officially filing their notice to appeal the decision to the U.S. Court of Appeals for the Fourth Circuit.
Senior U.S. District Judge Margaret B. Seymour lowered the financial penalty against Tuomey to about $237.4 million after the federal attorneys submitted a motion to lower the amount to correct what "appears to be a clerical error."
In her initial judgment, Seymour called for Tuomey to pay more than $39.3 million for false Medicare claims, as well as more than $237.4 million in False Claims Act penalties, even though the federal government had only requested the $237.4 million amount.
The nine-digit penalty stems from the retrial, completed back in May, of a 2005 lawsuit against the hospital in which the federal government said Tuomey violated Stark Law and the False Claims Act and thereby collected fraudulent Medicare claims between 2005 and 2009.
After a four-week trial, a 10-person jury ruled in favor of the government, saying Tuomey did, in fact, file 21,730 false claims for procedures performed by 19 local doctors operating under lucrative part-time contracts with the hospital. During the trial, the government convinced the jury that by paying the doctors as much as they did for their services, Tuomey was, in effect, paying an illegal kickback to these physicians with a portion of the Medicare funds the hospital collected for hosting the procedures.
Officials with the hospital said Tuesday they would continue to pursue a post-judgment settlement with the government, which, if reached, would prevent the case from going to the appellate court. This comes a week after Tuomey also announced their CEO, Jay Cox; vice president, Gregg Martin; and Nexsen Pruet the law firm representing Tuomey were all leaving the hospital.
For their part, federal attorneys have said they remain open to reaching a settlement, as well.
Meanwhile, not only is Tuomey appealing the financial judgment against the hospital, but they have also requested the appellate court reconsider their motion, denied by Seymour, calling for either a new trial or a judgment in their favor. In addition to this, Tuomey has also asked the appellate court to reconsider the July 2010 motion made by the federal government that granted the retrial of the case in the first place.