Surgeons file $4.5 million whistleblower retaliation suit against Samaritan Health Services

In a significant development in the health care industry, two Corvallis-based reconstructive surgeons have filed a $4.5 million whistleblower retaliation suit against Samaritan Health Services, a major health system in the region. The lawsuit, which was recently filed, alleges that the surgeons were terminated after reporting medical billing irregularities and other unethical practices within the organization.

Background of the Case

Samaritan Health Services operates several hospitals and health plans in Oregon, including the Good Samaritan Regional Medical Center in Corvallis, Samaritan Albany General Hospital, Samaritan Lebanon Community Hospital, Samaritan North Lincoln Hospital, and Samaritan Pacific Communities Hospital in Newport. The health system also manages the InterCommunity Health Network, a regional state-contracted coordinated care organization that operates as a highly regulated insurer.

The two surgeons, who have remained anonymous to protect their identities, claimed that they discovered discrepancies in medical billing practices while working at Samaritan Health Services. They alleged that the discrepancies were significant and could potentially result in millions of dollars in overpayments to the health system.

Whistleblower Allegations

According to the lawsuit, the surgeons reported their findings to higher management within Samaritan Health Services. However, instead of addressing the allegations, they were met with retaliation. The lawsuit claims that the surgeons were terminated shortly after reporting the irregularities, allegedly due to their efforts to expose unethical practices.

The allegations against Samaritan Health Services are severe. They include claims of inaccurate claims processing, improper denial of benefits to patients with multiple conditions or comorbidities, and administrative conflicts of interest. The surgeons also alleged that the health system paid more to Samaritan-affiliated providers than other providers, which they termed "unlawful."

Whistleblower Protection Policies

In recent years, there has been a growing emphasis on protecting whistleblowers in the healthcare industry. Samaritan Health Services has its own whistleblower policy, which aims to foster an environment where employees feel free to report actual or suspected instances of non-compliance without fear of intimidation, threats, or retaliation.

The policy states that any individual found to have violated this policy, including those who engage in harassment, false accusations, or malicious rumors, is subject to disciplinary action, up to and including immediate termination of employment. The policy also encourages employees to report any perceived issues or violations to the Chief Compliance Officer or the Director of Human Resources, who have been designated as the individuals to administer this policy.

Legal Implications

The lawsuit filed by the two reconstructive surgeons has significant legal implications. It highlights the importance of protecting whistleblowers and ensuring that healthcare organizations adhere to ethical standards. The court proceedings are expected to scrutinize the internal policies and procedures of Samaritan Health Services, particularly regarding whistleblower protection and retaliation.

Potential Outcomes

If the lawsuit is successful, it could result in substantial financial damages for the two surgeons. The $4.5 million claim includes back pay and other damages, which could set a precedent for future whistleblower cases in the healthcare industry. Additionally, the court's ruling could lead to changes in Samaritan Health Services' policies and procedures to better protect whistleblowers.

Industry-Wide Impact

The case has broader implications for the healthcare industry. It underscores the need for robust whistleblower protection policies and the importance of fostering an environment where employees feel safe reporting irregularities without fear of retribution. Other healthcare organizations may need to reassess their own policies to ensure compliance with federal and state regulations regarding whistleblower protection.

Previous Cases and Precedents

There have been several high-profile cases involving whistleblower retaliation in the healthcare industry. One notable case is Fahlen v. Sutter Central Valley Hospitals, where a physician was terminated after reporting substandard performance by hospital nurses. The court ruled that the hospital's action constituted retaliation and violated the Health and Safety Code.

Conclusion

The lawsuit filed by the two reconstructive surgeons against Samaritan Health Services highlights the critical role that whistleblowers play in ensuring ethical practices within the healthcare industry. The case underscores the need for robust whistleblower protection policies and the importance of fostering an environment where employees feel safe reporting irregularities without fear of retribution. The outcome of this case could set a precedent for future whistleblower cases and lead to significant changes in how healthcare organizations handle allegations of unethical practices.

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References

• False Claims Act Settlements and Judgments Exceed $2 Billion in Fiscal Year 2022: Justice.gov
• Former Samaritan Health Exec Claims State Contract Violations: The Lund Report
• Whistleblower Policy at Samaritan Medical Center: Samaritan Health
• Fahlen v. Sutter Central Valley Hospitals: Casetext