Eight months after he submitted his resignation, Dr. Craig Kent faces a lawsuit that alleges he orchestrated a hostile takeover of the University of Virginia Health System and proceeded to institute illegal practices that led to worse outcomes, including the deaths of two patients, and a culture of fear, intimidation and retaliation.
The 100-plus-page suit, filed Oct. 3 in the U.S. District Court of the Western District of Virginia by the widows of two dead UVa patients and a handful of doctors, alleges the “Kent Enterprise” committed fraud, illegally retaliated against employees who challenged their CEO’s authority and violated the Racketeering and Corrupt Organizations, or RICO, Act.
“This case arises out of a hostile takeover of a revered medical system by a cadre of individuals determined to maximize revenues and rankings, thereby inflating their own career prospects and financial gain, through concerted, repeated, and consistent illegal acts,” according to the plaintiffs.
Their suit was filed roughly 13 months after 128 physicians and faculty members signed a letter of no confidence in UVa Health leadership, prompting an investigation that led to Kent’s resignation, followed by the resignation of multiple other high-ranking UVa Health officials.
Plaintiffs, represented by the Charlottesville-based firm of MichieHamlett and New Orleans-based Jones Swanson Huddell, requests compensation, but as a civil suit theirs cannot and does not seek any relief for any crimes committed.
“What we can do under the law is bring a RICO action when there is an enterprise established to engage in criminal acts that damage and hurt people; and that’s what we’ve alleged here,” attorney Gladstone Jones of Jones Swanson Huddell told the Daily Progress.
That said, the suit is the first time a public document has explicitly said UVa Health is the target of a federal investigation.
“The United States Department of Justice launched an investigation into unlawful billing practices and regulatory misconduct by UVA Affiliates and the Kent Enterprise,” the suit reads.
Exits and investigations
Many of the named defendants in the suit are no longer at UVa, with most of them resigning within a five-month span between February and July.
An internal UVa memo in July revealed Wendy Horton, CEO of UVa’s flagship medical center in Charlottesville, would be leaving for the University of California, San Francisco, health system. The next month, Dr. Melina Kibbe, dean of the UVa School of Medicine, announced she would be leaving for the University of Texas Health Science Center at Houston.
Kent’s resignation came earlier, in February, after UVa’s governing Board of Visitors reviewed a report prepared by the Washington-based law firm of Williams & Connolly, which had been tasked with investigating the claims of illegal and unethical wrongdoing in the health system. Physicians and faculty members said Kent and his top brass lined their pockets while hospitals remained short-staffed, tampered with billing and patient records, disregarded policies, tenure and ethics, and threatened those who spoke out against them.
The Board of Visitors meeting was held behind closed doors and the report’s findings have never been made available to the public.
The claims made in the civil suit filed earlier this month mirror those Williams & Connolly investigated, according to MichieHamlett attorney Les Bowers. Bowers said plaintiffs have waited months for the health system to take responsibility for the illegal and unethical practices of the Kent administration.
“We interfaced repeatedly with university counsel’s office and UPG [the UVa Physicians Group], and in multiple conversations, we gave them extensions on extensions to try to avoid to file. I saw them multiple times,” he told The Daily Progress. “No one wanted to accept responsibility or even take the claim seriously, and so here we are.”
Jones said Kent, Horton, Kibbe and others named in the lawsuit “were directly involved in the development of the strategy that included these illegal acts and caused these damages. And that’s why they were named and others were not.”
UVa Health is keeping quiet.
Health system spokesman Eric Swensen told The Daily Progress “the University does not generally comment on pending litigation.”
Kibbe, no longer with university, was less tight-lipped when she spoke with the Houston Chronicle about the matter.
Kibbe told the newspaper it is “unfortunate that these unfounded and baseless allegations continue to be brought forth” and she is eager for “the truth to prevail through the judicial system as there is no legal basis for this lawsuit.”
The ‘Kent Enterprise’
Plaintiffs allege that Kent began constructing his criminal enterprise shortly after his hiring in February 2020, hiring Horton a month later “without meaningful faculty input or a competitive search process.”
Prior to their arrival in Charlottesville, Kent and Horton had overlapping stints at Ohio State University and the University of Wisconsin.
At Ohio State University, where Kent was dean of the College of Medicine and Horton was chief administrative officer of the Wexner Medical Center, Kent was the target of another letter of no confidence, claiming he and others lacked respect for the academic mission of the university and its health system.
While Kibbe and Kent did not overlap at any university health system (at least not according to their public resumes), it was widely reported that she was handpicked for the job leading the School of Medicine at UVa the year after Kent took the helm.
During Kent’s five-year tenure at UVa, roughly 550 faculty members and 16 of the 21 clinical department chairs at the School of Medicine were replaced or hired.
“The Kent Enterprise engaged in what amounted to a hostile takeover of UVA’s medical institutions. They swept aside long-serving leaders, silenced dissenters, and installed loyalists in key roles to clear the way for their profit-driven scheme,” the suit says.
Almost all of the new hires “were selected outside of traditional governance protocols and long-established policies and procedures,” according to the suit.
The suit names two hires in particular, Dr. Ourania Preventza and Dr. Kim De La Cruz, who it says not only helped further Kent’s takeover but whose incompetence led to the deaths of two patients.
The suit says De La Cruz was hired despite knowledge of his lack of surgical skill or administrative experience, as well as his dangerous incompetence, because he would further the Kent Enterprise.
According to the plaintiffs, De La Cruz was hired despite surgical skill or administrative experience.
The chief of cardiac surgery at Brigham and Women’s Hospital in Massachusetts, where De La Cruz was on probation and could not perform surgeries independently, is quoted in the suit saying that if De La Cruz “had not left Brigham and Women’s Hospital, he would have been fired.”
According to the suit, De La Cruz was required to have a proctor during certain surgeries at UVa, but during the one that led to the death of a patient, the proctor selected to accompany De La Cruz was one of the newest members of the Cardiothoracic Department and was not in the operating room the entire surgery as required by UVa Health’s own policies.
“In addition, De La Cruz … engaged in fraudulent billing practices, including upcoding surgical risk levels to inflate reimbursement rates, and fraudulent charting, including falsification of medical records to avoid malpractice liability,” the suit says.
The suit alleges that De La Cruz, before the operation that proved fatal, calculated that the risk factor of death was about 3%, but after the operation, the risk score was changed to more than 20%.
The upped risk factor “triggered a higher, complexity-driven Medicare reimbursement for the procedure” and “sought to minimize any potential malpractice liability.”
Claims of fraudulent billing were not uncommon during Kent’s time at UVa. The suit says Kent’s Department of Surgery shifted “physician compensation exclusively to productivity metrics measured by Relative Value Units (RVUs), which incentivize volume and billing intensity over patient outcomes.”
The shift “created strong incentives for billing abuse,” the suit says.
As The Daily Progress previously reported after interviewing multiple current and former UVa Health officials and employees, there was “tremendous pressure” from senior leadership for physicians to charge patients more for treatment.
Michael Cannon, director of health policy studies at the Cato Institute think tank in Washington, told The Daily Progress last October that the federal Medicare insurance program in particular incentivizes hospital administrators to “encourage aggressive coding” practices.
“Upcoding in Medicare is rampant and notorious,” said Cannon, who likened the Centers for Medicare & Medicaid Services to an ATM that rarely scrutinizes the bills sent its way and simply hands over the cash to health systems.
Preventza “often extolled the use of fraudulent double-billing and advocated that the UVA Affiliates adopt the process,” according to the suit.
Double-billing is a process in which a hospital bills for two primary surgeons when two aren’t needed.
Just last year, Preventza’s previous employer, Baylor St. Luke’s Medical Center in Houston, agreed to pay a $15 million settlement after it was accused of double-billing patients.
At UVa, the suit says, Preventza and De La Cruz submitted claims for surgeries not performed jointly or without appropriate supervision and attempted to force others to do so too
“Residents were instructed to misrepresent the structure of procedures and Preventza ordered them to perform procedures they had not yet been taught. Credentialing, privileging, and documentation related to the same were altered and falsified to increase billing,” the suit reads.
Retaliation
The suit alleges that a handful of UVa doctors who stood up to leadership were silenced, demoted and disciplined.
One of the plaintiffs, Dr. Kenan Yount, claims he was told that Kent and Kibbe “were well-connected leaders and that crossing them could be ‘not pleasant,’” when he attempted to bring up concerns about Preventza.
Following another attempt to bring up concerns, “two jobs were posted matching Dr. Yount’s and his partners’ job descriptions.”
Yount, who was director of the Structural Heart & Valve Center at the time, would later learn that a co-director had been hired at the center and that De La Cruz had been appointed to a position that he already held, according to the suit.
Yount ultimately left UVa Health in July.
Another plaintiff, Dr. Mark Roeser, alleges that Preventza and De La Cruz filed reports against him, falsely accusing him of bullying and other inappropriate behavior.
“These reports were never meaningfully investigated; Dr. Roeser was never even questioned about them. They made their way to his permanent file, though,” the suit says.
The suit also alleges that surgeons who opposed leadership were threatened with having their clinical privileges revoked at five-on-one meetings. After those meetings, Kibbe is said to have delivered messages to the surgeons outlining “a blatant act of defiance, insubordination, disrespectful behavior, unprofessional behavior, and a lack of accountability to authority.” The letters were placed in physicians’ human resources files without following any typical procedures, according to the suit.
What’s next
No date has been set for the suit to be heard in court, nor have all of the named defendants been served.
Attorneys for the plaintiffs said it is likely that the scope of the suit and the list of those implicated could grow.
Bowers said that “other people were involved, some of whom we have deliberately not named, some of whom we expect to learn more about once we get into the discovery process.”
He added that “people are coming out of the woodwork” to reach out to the attorneys with their claims or to share information regarding the case.
“An enormous amount of effort has been undertaken to understand exactly what happened at UVa, at the hospital, the medical school, and it’s just terrible, and it’s terrible for the people that brought this lawsuit, and it’s terrible for the community, and that is why the suit was filed,” Jones said.
Source: www.dailyprogress.com