Sacred Heart Revisited – Ed Novak Heads to Prison (Medicare Fraud Post)
Sacred Heart Revisited – Novak Heads to Prison
Last year we wrote about Sacred Heart Hospital, a now shuttered facility in Chicago. Once a thriving 100 bed private hospital, its doors were closed after its owner and several physicians were charged with criminal Medicare fraud. Many of the doctors and staff subsequently pleaded guilty, but not the hospital’s owner, Ed Novak.
Despite horrendous allegations of fraud and patient abuse, a defiant Novak went to trial. In early 2015 Novak was convicted of 26 counts of criminal conspiracy and violations of the Anti-Kickback law.
The case originally started after the families of two patients sued the hospital claiming their loved ones died because the hospital was allowing physicians to perform medically unnecessary and dangerous surgeries. The lawsuit was a private medical malpractice matter but some of the allegations contained in that suit accused the hospital of unnecessary surgery. That is a red flag for Medicare fraud.
The case also was also advanced by a physician turned whistleblower who approached the FBI with inside information. She was not charged with any wrongdoing but many of her colleagues were. Ultimately Novak and 10 other administrators and physicians were indicted.
Allegations included bribing ambulance drivers to take critical care patients to Sacred Heart (even if there were closer hospitals), paying kickbacks to doctors who admitted patients, paying patient recruiters to troll nursing homes looking for patients and running a hospital so dirty that it was infested by maggots.
Since his conviction, Novak still appears unrepentant and shows no remorse. On August 12th he was sentenced to just 54 months in prison and a $770,000 fine. Novak’s response? He filed a motion asking the court to disregard the jury’s verdict. When that didn’t work he asked for a new trial. And when that failed he filed an appeal.
Prior to his sentencing, prosecutors filed a 37 page sentencing memorandum. According to that memo, “In what is arguably his first post-trial opportunity to acknowledge his own failings and those of the hospital he ran, Edward Novak’s sentencing submission expresses no remorse, no acceptance of responsibility, and no recognition that there is anything he should have done differently. Instead, Novak diminishes the scope and severity of the jury’s verdict…”
We looked at Novak’s sentencing memo and agree with prosecutors. Rather than apologize and take responsibility for his actions, Novak discusses how much he and Sacred Heart cared for patients. This is the same hospital that Consumer Reports said had the lowest safety rankings of any hospital. One nurse claims that operating room staff was instructed to spray patients with “Off” bug repellant to keep the flies at bay.
The Centers for Medicare and Medicaid Services have also come after Novak trying to get back the millions taxpayers lost. Novak is fighting them too.
There are always two sides to every story. That’s why we have courts and a presumption of innocence in criminal cases. Here the jury has spoken, however, and convicted Novak of all but two counts of the indictment.
We don’t follow every story but some Medicare fraud cases are simply so heinous and shocking to ignore.
Most Medicare fraud doesn’t directly endanger patient safety. (It’s bad enough to steal from taxpayers, however.) Performing unnecessary surgeries, dispensing narcotics to addicts and allowing unlicensed healthcare workers to pose as doctors escalates Medicare fraud to an entirely new level, however. Novak obviously didn’t perform the unnecessary surgeries but he appears to be the mastermind of what can only be called a house of horrors. These are the cases we follow.
These are also the cases that cry out for whistleblowers, men and women who have grown tired of the greed and lack of respect for patients. We represent whistleblowers in False Claims Act cases and protect them from retaliation.
We make our living by prosecuting these cases. Under the False Claims Act, wrongdoers must pay triple damages to the government and can be held responsible for penalties of up to $11,000 per each false claim they submit. Whistleblowers are entitled to receive an award of up to 30% of whatever the government collects.
Unfortunately, it is the cases involving harm to patients that we often see little in the way of cash rewards. Why? Because any money collected often goes to the victims who were harmed. Sometimes there is no money because the wrongdoer is headed to prison.
We still take these cases. The greater good is to see fraud and wrongdoing stopped as early as possible.
Whistleblowers are the new American heroes. Last year over 700 came forward and filed lawsuits under the False Claims Act. In the same year, the government paid whistleblowers over $435 million in awards. Thousands more called the government’s Medicare fraud hotline, although calling the hotline doesn’t get you a big award. The only way to get a percentage award is by filing a sealed lawsuit in federal court. We can help.
For more information about becoming a whistleblower, contact attorney Brian Mahany at or by calling (414) 704-6731 (direct). Even if you are unsure what to do, we can help you evaluate your options. Don’t wait until patients suffer, help put an end to Medicare fraud today.
MahanyLaw – America’s Medicare Fraud Lawyers