If physicians didn't have enough to worry about with governmental enforcement of Stark law, the anti-kickback statute and other fraud, waste and abuse laws, many physicians are now finding their doors darkened by a new menace in the form of bankruptcy trustees seeking "clawbacks,” Diagnostic Imaging reported yesterday. In Aetna Life Insurance Company v. Humble Surgical Hospital LLC, Aetna won a $51 million judgment against Humble, alleging, in part, that Humble illegally paid 103 doctors up to 30 percent of its technical fee in exchange for referrals. Humble immediately filed for bankruptcy protection. Aetna then sued each of the 103 doctors, claiming that Aetna, as a judgment creditor of Humble, should be allowed to claw back the illegal payments. A similar scenario occurred when Health Diagnostics Laboratory paid physicians processing and handling fees of $10 to $17 per referral as inducements for the physicians to refer patients to them for blood tests. HDL filed for bankruptcy protection and the trustee began notifying physicians that the transfers were fraudulent under the Bankruptcy Code, and the trustee expected the payments to be returned to the bankruptcy estate. It can be argued that the trustee didn't do anything wrong and wasn't even around when the bad acts occurred. The trustee merely acts as an agent seeking to recover for the innocent creditors of the debtor, often those who were the real victims of the fraud. In many cases, the judge may be called upon to rule whether or not the doctors were innocent victims too. The good news is that the bankruptcy trustee will offer that the physician can settle without being sued, and is not required to agree that he did anything wrong in the settlement papers. Further, because the rules of court encourage settlements, the offer in compromise or actual settlement, is usually inadmissible in any subsequent case. If there is to be a governmental enforcement action, the trustee's claim is independent, and has nothing to do with the work of the OIG or DOJ.
For more on hospital and health care insolvencies, be sure to pick up a copy of the ABI Health Care Insolvency Manual, Third Edition from the ABI Bookstore.