Dan Rodricks

Dan Rodricks: MedStar scheme makes 'Healthy Holly' look like child's play

MedStar agreed to a $35 million settlement over allegations that it engaged in a kickback scheme with a now defunct cardiology practice.

In the midst of the seedy scandal at the University of Maryland Medical Systems — involving members of the UMMS board, including the mayor of Baltimore and her profitable deal on “Healthy Holly” children’s books — comes a tale of systemic hospital corruption that could have put the lives of patients at risk.

It makes the self-dealing at UMMS look like a game of Chutes and Ladders.


This one involves MedStar Health, the largest health care system in the Baltimore-Washington area, with 10 hospitals. It’s a $5 billion tax-exempt not-for-profit headquartered in Howard County. Among its hospitals are Union Memorial, in Baltimore, and Franklin Square, in Baltimore County.

According to federal authorities, a group of doctors in Pikesville, the now-defunct Mid-Atlantic Cardiovascular Associates, the largest such practice in the area at the time, took kickbacks from Union Memorial and Franklin Square. In return, the physicians group made referrals of patients for “lucrative cardiovascular procedures.” This arrangement started in 2006 and continued for five years.


Kickbacks are illegal payments that politicians, crooked bureaucrats or corporate insiders take in return for favoring certain companies in the awarding of contracts. We don’t usually associate kickbacks with people with degrees in medicine.

“Kickbacks give doctors an incentive to pursue unnecessary treatments that are costly and sometimes even dangerous to patients,” the U.S. Attorney for Maryland, Robert K. Hur, said in a statement last week. “We will not tolerate medical care providers who put their patients at risk and waste taxpayers’ dollars in order to line their own pockets.”

Note the words “will not tolerate.” That might sound like the region’s top federal prosecutor was about to indict some MedStar executives and cardiologists.

But nothing like that happened.

Nobody’s going to prison as a result of the kickback scheme.

Instead, MedStar agreed to pay $35 million to the federal government to settle allegations and two whistleblower lawsuits, one filed by another cardiologists’ group, the other by a group of MedStar patients.

It’s good that the feds are collecting that money on behalf of the whistleblowers, patients and taxpayers. But MedStar doesn’t even admit it did anything wrong. In fact, it seems to treat the whole thing like it’s just the price of doing business.

In a statement issued Thursday, MedStar patted itself on the back: “We fully cooperated with the government’s investigation of these matters and ultimately determined that it was best to settle these matters in order to avoid protracted and distracting litigation. Importantly, the two cases have been settled without any findings of liability. MedStar has full confidence in our quality assurance and compliance programs, and we remain fully focused on advancing our patient care mission.”


Isn’t that great?

Wait. There’s more.

According to the government’s claims in the settlement, which MedStar denies, John Wang, a cardiologist who left the Pikesville group to take a job at Union Memorial, performed unnecessary stent procedures on patients, and MedStar billed Medicare for them. The feds say this occurred over nearly seven years, ending in December 2012.

Can we all agree that putting unnecessary stents in patients’ arteries is a bad thing? In fact, a few years ago, there was another doctor in the area who performed hundreds of those procedures, and St. Joseph Medical Center ended up paying $37 million to settle the lawsuits that followed. That doctor lost his license to practice in Maryland.

Wang, on the other hand, still has his job. He’s chief of the cardiac catheterization laboratory at Union Memorial. MedStar praised Wang in a statement I received over the weekend: “MedStar Health stands firmly behind Dr. Wang as a physician and a leader. Dr. John Wang is a nationally recognized leader in the field of cardiac catheterization. Under his leadership, the cardiac program at MedStar Union Memorial Hospital has advanced clinical research, quality outcomes, and technological innovations. We look toward a future of continued success in the program under his critical guidance.”

Anybody have a clue about how we got to a place where a hospital cites the “leadership” of a doctor accused by federal prosecutors of performing unnecessary stent procedures on patients?


There were two other statements issued by federal officials in this case.

Maureen R. Dixon, special agent in charge for the Office of Inspector General at the Department of Health and Human Services, said: “Patients rightly expect their doctors will make recommendations based on sound medical practice — not payoffs that too often result in needless and sometimes even harmful procedures.”

Jody Hunt, an assistant attorney general, said: “Kickbacks made in connection with the provision of medical services undermine the integrity of our healthcare system. We will take action against medical service providers who through unlawful conduct put their own financial interests ahead of the best interests of patients.”

That all sounds great, but there are no criminal charges. A $5 billion medical system pays $35 million to make “distracting litigation” go away. Where’s the public apology? Where’s the shame?

Update: The initial version of this article has been edited to clarify MedStar’s denial of specific allegations by the government described in the settlement.