The Clinton Herald, Clinton, Iowa

October 2, 2013

TRIAL UPDATE: Regenwether testimony details fire department's EMS billing process

By Katie Dahlstrom
Assistant Editor

DAVENPORT — Former Clinton Fire Chief Mark Regenwether concluded his testimony in the city of Clinton's legal malpractice suit Wednesday morning.

Regenwether was called by the city of Clinton Tuesday as the first witness as the city tries to prove legal malpractice on the part of attorney Michael Walker and his law firm Hopkins and Huebner.

The city claims Walker’s negligence in an emergency medical services case resulted in the city reaching a $4.5 million settlement with whistleblower Timothy Schultheis and the U.S. Department of Justice in 2010.

Walker’s firm was retained to represent the city’s interests in 2009 after Schultheis filed a complaint under the Federal False Claims Act that emergency medical calls handled by city ambulances were being improperly coded. By listing even routine calls as advanced life support calls rather than basic life support calls, Schultheis claimed the city was able to receive higher reimbursement rates from Medicare and Medicaid.

Attorney Mike Hannafan, who is with one of two firms the city hired to pursue the legal malpractice case, started the third day of the trial by asking Regenwether about a meeting that happened in February 2009 with Regenwether, then EMS director Andrew McGovern, former city attorney Paul Walter, Assistant U.S. Attorney Maureen McGuire and Kory Ihnken, an investigator with the U.S. Attorney General's office.

Although Regenwether was unaware at the time because Schultheis's federal lawsuit was still under seal, Schultheis had been in contact with McGuire and Ihnken about the city's alleged Medicare fraud.

Regenwether testified that he understood the meeting was about the fact that 99 percent of the city's Medicare calls reviewed were ALS as was indicated by a letter from McGuire he received in a month earlier, but was not told the city was being investigated for Medicare fraud. During the meeting, city representatives were asked to explain the city's coding and billing procedures for emergency medical services.

Regenwether testified that McGuire and Ihnken were asked if the city needed to change its procedures, but but they did not give the city any direction other than to send more records.

"I was lost. I still didn't know if we were doing anything right or wrong," Regenwether said.

A week after the meeting, Regenwether sent an e-mail to former mayor Rodger Holm explaining the meeting went well and there did not seem to be any illegal activity. Regenwether wrote he was unsure how many errors in coding there were, though he did not predict there were a large number. After the meeting, the city did change one billing procedure that ensured two codes were placed on bills that were sent to Medicare.

Regenwether also testified that he had nothing to gain by upcoding emergency calls or bills to the federal government and that any money the fire department got in reimbursements went into the city's general fund and not specifically to the fire department.

Bob Waterman, with Lane and Waterman, the firm representing Walker, conducted a cross examination of Regenwether on Wednesday morning.

Waterman asked Regenwether about the meeting with McGuire and Ihnken, specifically if anyone from the city's finance department was present. They were not, Regenwether said.

Waterman asked Regenwether if anyone at the fire department verified the bills being sent to Medicare and Medicaid, which they did not, Regenwether said. Regenwther testified he believed the billing and

checking for the codes on the bills was done by the finance department.

It was not until after the settlement had been reached that Regenwether learned finance clerk Sarah Nolan was not checking for accuracy, but performing only data entry.

Regenwhether and McGovern's repeated requests for the city to outsource billing and institute a dispatch protocol also were brought up Wednesday. It wasn't until after the 2010 settlement that the city

decided to outsource billing and a dispatch protocol was put in place.

With a dispatch protocol, dispatch can code the call rather than the coding assessment being performed by the paramedics on scene.

While an average of 99 percent of the city's Medicare and Medicaid calls were billed as ALS from 2002 to 2008, the time under scrutiny in the whistleblower suit, that percent has fallen to 86 percent since the


Waterman also asked Regenwether about the performance reviews of Schultheis conducted by battalion chief Joel Atkinson.

On Tuesday, Regenwether testified Schultheis was "headstrong" and not the easiest to talk to. However, Schultheis's reviews painted another picture.

"I enjoy having Tim on my shift," Atkinson wrote.

Schultheis also was referred to as "willing to learn" and having an "excellent attitude."

In a February 2008 review, Atkinson wrote that Schultheis needed to accept certain procedures that he had been questioning. Schultheis had verbally complained to McGovern and Atkinson about the emergency call coding procedures by that time.

On May 14, 2008, Atkinson wrote to Regenwether that Schultheis should be removed from his probationary period and promoted to firefighter.

Following Regenwether's testimony, Schultheis took the stand under subpoena as an adverse witness.

His testimony will continue Wednesday afternoon.