Becker's Hospital Review

December_HR_2018

Issue link: https://beckershealthcare.uberflip.com/i/1058375

Contents of this Issue

Navigation

Page 16 of 55

17 CFO / FINANCE CHI allegedly defrauded of millions by IT employee, 2 others: 7 things to know By Alyssa Rege A federal grand jury indicted three men Oct. 11 on multiple counts of fraud and money laundering for de- frauding Englewood, Colo.-based Catholic Health Initiatives, according to the U.S. De- partment of Justice. Here are seven things to know: 1. Two individuals, David Rietz and Rich- ard Cartwright, were indicted Oct. 11 and charged with mail fraud, wire fraud, conspir- acy to commit mail and wire fraud, aiding and abetting, money laundering, and con- spiracy to commit money laundering. e third defendant, Lyle Perry, was charged Oct. 12 with conspiracy to commit money laun- dering. All three men entered not guilty pleas at their respective court hearings. 2. According to the indictment, Mr. Rietz was an employee of CHI, and Mr. Cartwright was a principal at Cross IT Group. e Justice De- partment alleges between roughly September 2013 and January 2014, Mr. Rietz and Mr. Cartwright conspired to defraud CHI and split the payment. 3. Mr. Rietz was responsible for a soware integration project at CHI involving the use of proprietary soware sold by a third-party company. e Justice Department alleges Mr. Rietz used his authority to hire Cross IT to implement the third party's soware at the health system. 4. In implementing the soware at CHI, Mr. Cartwright submitted 25 "quotes" to the health system for soware and services, to- taling more than $72 million. Mr. Rietz then signed and processed those quotes through the health system. In total, Mr. Rietz pro- cessed $19.89 million in four payments from CHI to Cross IT as part of the scheme. 5. Aer receiving the payments from CHI, the men transferred the payments to bank accounts controlled by their third co-conspirator. 6. For each count of fraud, each man faces up to 20 years in prison and a fine of $250,000 or no more than twice the gross pecuniary gain or loss from each offense and restitution. 7. A CHI spokesperson shared the following statement with Becker's Hospital Review: "CHI discovered the transactions shortly aer they occurred and has worked collaboratively with law enforcement. e organization took immediate legal action and recovered the ma- jority of the funds. e individual's employment with CHI was terminated in December 2013." n Arizona hospital rebrands after bankruptcy By Ayla Ellison G reen Valley (Ariz.) Hospital has emerged from the bankrupt- cy process with a new owner and a new name, according to the Arizona Daily Star. Green Valley Hospital entered Chapter 11 bankruptcy in early 2017 and received permission from the bankruptcy court to sell its assets. In January, Lateral GV, part of equity firm Lateral Investment Man- agement, submitted the winning bid for the facility. In February, the bankruptcy court approved the sale to Lateral GV, and the hospital emerged from bankruptcy in July with a new name: Santa Cruz Valley Regional Hospital. Although the hospital exited the bankruptcy process, its financial challenges continued. Santa Cruz Valley Regional Hospital laid off 60 employees in July. The hospital's financial footing has stabilized since July, and it is now looking to grow its workforce. "We're staffed and ready (for the influx in winter population) and look forward to adding more employees back in," Santa Cruz Valley Re- gional Hospital CEO Kelly Adams told the Arizona Daily Star. The hospital may also add more services in the future. "I talk with patients every day, and they say they're tired of going to Tucson for their healthcare," Ms. Adams said. "This encourages us to bring more physicians in and more services." n HCA hospitals win $150M in arbitration against Aetna By Morgan Haefner A n arbitrator awarded Florida hospitals owned by Nashville, Tenn.-based HCA Healthcare $150 million in out-of-net- work emergency room payments from Aetna, the health insurer revealed in a Securities and Exchange Commission filing. Aetna was named as a respondent in the ar- bitration proceeding Oct. 28. The proceeding stemmed from a lawsuit the hospitals filed in Florida court Aug. 25, 2015. The HCA-owned hospitals' arbitration proceeding concerned Aetna's out-of-network and administration prac- tices in Florida for its individual ACA exchange products from 2014-16. Aetna largely exited the individual exchange business at the end of 2016. The arbitrator awarded the claimant hospitals roughly $150 million Oct. 15. In its SEC filing, submitted Oct. 30 with Aetna's third-quarter earnings, the health insurer said it intends "to continue to defend ourselves vigorously against the claimant hospitals' claims and to appeal the arbitrator's decision." n

Articles in this issue

view archives of Becker's Hospital Review - December_HR_2018