Providence Health & Services Settles $22.7 Million In Spine Surgery Case

Walla Walla, WA (WorkersCompensation.com) – Outcomes are hard to determine in Neurosurgery cases, and some studies have shown that around 14 percent of surgeries will have some kind of complication. In the U.S., each year around 900,000 patients have spine surgery, compared to only 30,000 per year in Canada. Some estimates show that around 10 to 15 percent of adults have chronic back pain.

In a press release earlier this week from the Eastern District of Washington Department of Justice, a recent settlement could explain a potential contributor to the higher number of spinal surgeries in the U.S.  Washington State Attorneys Bob Ferguson and Vanessa R. Waldref announced earlier this week that Providence Health & Services (Providence) agreed to settle for $22.7 million to resolve allegations of fraudulent billing of spine surgeries.

Providence is a non-profit Catholic healthcare system with headquarters in Renton, Washington. The large group operates facilities across 7 states, with 25K physicians in 52 hospitals and 950 clinics. The group statistics show 28.1 million in total patient visits.

According to the complaint which was filed in 2020, the whistleblower in this case was the former Medical Director of neurosurgery at Providence, St. Mary’s. In this case, the whistleblower and former Medical Director will receive $4,197,734 of the proceeds from the settlement.

The lawsuit alleged that two unidentified spine surgeons were employed with the hospital between 2013 and 2018. The complaint alleges that both physicians were paid based on productivity metrics, which provided a financial incentive for them to perform spine surgeries with more complexity resulting in higher reimbursement. Between 2014 and 2017, one of the un-named physicians was the highest producing neurosurgeon in the entire Providence group, equating to $2.5 million and $2.9 million payouts per year.

As a part of the settlement agreement, Providence admitted that during the term of employment of the two physicians, medical personnel relayed concerns of patient’s safety. Additionally, Providence admitted that due to their employment there were excessive levels of surgeries resulting in high levels of complications and outcomes, and that surgeries were performed on patients that were not appropriate candidates for spine surgery and proper documentation of procedures and outcomes was not done.

In addition to these statements, Providence further admitted that the high production physician had provided false or exaggerated diagnoses in dictation in order to gain reimbursement for the surgeries, performed surgeries without meeting proper medical necessity, performed surgeries above scope of what was medically appropriate, and jeopardized patient safety. Furthermore, the group has admitted that both physicians were placed on administrative leave but were allowed to resign without sanction as they were not reported to the National Practitioner Data Bank or the Washington State Department of Health.

As part of the agreement, Providence has entered into a Corporate Integrity Agreement per requirements of Department of Health and Human Services, Office of Inspector General (HHS-OIG).

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