The Clinton Herald, Clinton, Iowa


October 5, 2013

Defendant: City knew there were EMS billing concerns

CLINTON — Too many people knew what was going on and chose to do nothing for the city of Clinton to have called its alleged Medicare fraud a big mistake, attorney Michael Walker testified Friday.

Walker returned to the witness stand Friday as the city of Clinton's legal malpractice suit against him continued at the Scott County Courthouse.

Walker and his firm Hopkins and Huebner represented the city in the emergency medical services case that resulted in the city settling with whistleblower Timothy Schultheis and the U.S. Department of Justice for $4.5 million in 2010. Schultheis and his attorneys received $1.35 million of that settlement, with three payments already made.

Schultheis filed a federal False Claims Act complaint, claiming that emergency medical calls handled by city ambulances were being improperly coded. By coding even routine calls as emergency calls, Schultheis claimed the city was able to receive higher reimbursement rates from Medicare and Medicaid.

The city alleges Walker negligently failed to properly and adequately analyze the case and is seeking to recoup the expenses of the settlement along with other fees, totaling $4.67 million.

Walker's attorney, Bob Waterman, spent Friday morning asking Walker questions about himself and the federal False Claims Act suit. To be deemed in violation of the FCA, the party must have knowingly submitted a false claim to the government, which can be done through actual knowledge, deliberate ignorance or reckless disregard. Innocent mistakes or negligence are not actionable under the FCA.

However, the city couldn't contribute its 99 percent ALS billing rate from 2002 to 2008 to a mistake, Walker believed. He testified that he found several red flags or obstacles in the defense of the city's case as he worked on it from October 2009 to September 2010.

Among the red flags was the credibility of EMS Director Andrew McGovern, who was the one training the city's paramedics how to code an ambulance run. Schultheis alleged the city was billing all its calls as advanced life support instead of basic life support for the city to get more money out of the federal programs. This was knowingly being done at the direction of McGovern, Schultheis claimed.

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