Federal Suit Against Hamot Set for Trial

The plaintiff, who is also a cardiologist, is claiming that Hamot violated federal law about 10 years ago by submitting claims to Medicare as part of an improper financial relationship with physicians.

Eric, PA (November 10, 2017) - A years-old federal lawsuit against UPMC Hamot has been cleared to go to trial.

But the judge who ordered the suit to proceed also narrowed it in ways that benefit both the plaintiff and the defendants, including a group of cardiologists.

The case is related to Medicare. The plaintiff, who is also a cardiologist, is claiming that Hamot violated federal law about 10 years ago by submitting claims to Medicare as part of an improper financial relationship with physicians.

The suit was served on the defendants in November 2012. Since then, the plaintiff has argued that he has enough evidence to win the case without the need for a trial. And Hamot and the other defendants have argued that case should be tossed before trial due to lack of evidence.

Chief U.S. District Judge Joy Flowers Conti accepted some of both sides' contentions in a 37-page opinion filed in U.S. District Court in Erie on Wednesday.

Conti rejected the defense's request to toss the entire suit, though she dismissed the cardiologists as defendants. They are Richard W. Petrella, M.D.; Robert J. Ferraro, M.D.; Charles M. Furr, M.D.; and Timothy C. Trageser, M.D. Another cardiologist, Donald Zone, M.D., was dismissed as a defendant in 2013.

The doctors are with Medicor Associates Inc., which remains a defendant with UPMC Hamot, known as Hamot Medical Center when the suit was filed. Medicor is Hamot's full-service cardiology group.

Conti also rejected the request of the plaintiff, Tullio Emanuele, M.D., that Conti grant what is known as summary judgment and rule entirely in favor of Emanuele before trial. But in a victory for Emanuele, Conti ruled that pretrial evidence showed Hamot violated federal law over a 22-month period because of a lack of some written agreements related to Medicor.

At trial, Emanuele and his lawyer, Andrew Stone, of Pittsburgh, still must prove that the violation was intentional and that it had a material effect on the government's decision to pay the Medicaid reimbursements, according to court records. If Emanuele prevails, a jury could order Hamot to repay the disputed funds with penalties.

"We are pleased that this case is moving forward to trial, and we believe it is a strong case," Stone said.

A lawyer for Hamot, Neal Devlin, said he is reviewing the opinion and declined further comment.

The dismissal of the claims against cardiologists follows a favorable development from a year ago. Emanuele in February 2016 withdrew claims that the cardiologists performed unnecessary surgeries, mainly to insert heart stents, to make more money for their practice and Hamot.

Until Wednesday, most of the cardiologists had remained in the case as defendants. Emanuele focused on claims that their contracts with Hamot were financially improper.

Conti on Wednesday tossed those claims. She found no one presented evidence that the cardiologists "were involved in negotiating, drafting or formulating the terms and conditions of (the) agreements" involving defendants Medicor and Hamot.

Emanuele, who now works in Kentucky, was with Medicor from June 2001 through May 2005, according to court records. He is suing his former practice under the federal anti-kickback law and the federal Stark Act. The act bans a hospital from submitting a claim to Medicare for services that were prescribed by a physician who has an improper financial relationship with the hospital.