Lawsuit Filed Against MultiCare Health System Over Allegations that a Physician Endangered Patients and Fraudulently Billed Federal Health Care Programs
The United States Department of Justice (DOJ) recently announced that the United States and the State of Washington filed a Complaint in the United State District Court for the Eastern District of Washington against MultiCare Health System, alleging that MultiCare knowingly endangered patient safety and falsely and fraudulently billed Medicare, Medicaid, and other federal health care programs for spinal surgery procedures performed at MultiCare Deaconess Hospital between 2019 and 2021 by Jason Dreyer, a former neurosurgeon.
The Complaint alleges that before working for Deaconess, Dreyer practiced at Providence St. Mary’s Medical Center in Walla Walla, Washington. In 2019, Dreyer resigned from his position amidst allegations that he was performing medically-unnecessary surgeries, harming patients, and falsifying diagnoses.
Following that resignation, MultiCare hired Dreyer to perform neurosurgery procedures at Deaconess, despite concerns and “numerous red flags, warnings, and specific evidence” that popped up during the hiring process about Dreyer and his surgical judgment from his employment with Providence. However, MultiCare decided to hire, credential, employ, and supervise him to see patients and perform surgeries at Deaconess starting in July 2019.
According to the Complaint, MultiCare “allow[ed] and incentiviz[ed] Dr. Dreyer to perform a high volume of complex spinal surgeries operating on hundreds of unsuspecting patients and putting financial considerations in front of the safety and health of those patients.” MultiCare further recognized that Dreyer was performing a high volume of surgeries, and therefore generating a significant revenue for MultiCare, and on October 1, 2019, MultiCare placed Dreyer on an incentive compensation structure, allowing him to make more money if he performed more complex surgeries on a greater volume basis. On the incentive compensation structure, there was no limit on the amount he could ultimately earn.
The Complaint continues to allege that in February 2020, the United States Attorney’s Office informed MultiCare that it was investigating concerns that Dreyer was harming patients, falsifying diagnoses, and performing medically-unnecessary surgeries. Despite this information, MultiCare and Deaconess allowed Dreyer to continue to see patients and perform surgery. It wasn’t until the Washington Department of Health suspended Dreyer’s ability to perform surgery in March 2021 that he stopped performing surgeries.
In addition to endangering patients, MultiCare falsely and fraudulently claimed and received reimbursement for millions of dollars from federal health care programs during the time Dreyer was employed, including Medicare, Washington State Medicaid, the United States Department of Veterans Affairs Community Care program, TRICARE, and the Federal Employee Health Benefits program.
“The filed complaint is a constructive step forward in holding MultiCare accountable for putting profit ahead of patient care and safety by willfully ignoring the dubious practices of one of its doctors,” said Bryan D. Denny, Special Agent-in-Charge for the Department of Defense (DoD), Office of Inspector General, Defense Criminal Investigative Service (DCIS), Western Field Office. “DCIS remains committed to working with its partners to identify and eliminate fraudulent schemes that endanger patient safety and corrupt the integrity of the DoD’s health care program.”
Related Actions
This action is filed after an April 2022 settlement with Providence for similar conduct. In that case, Providence agreed to pay roughly $22.7 million and implement a standard of care corporate integrity agreement to resolve liability surrounding surgical procedures performed by Dreyer (and another neurosurgeon) that were billed to federal health care programs. Also, in April 2023, Dreyer agreed to pay nearly $1.2 million to resolve his own individual liability under the False Claims Act.