Federal prosecutors said Tuesday that they lacked evidence to bring criminal charges against physicians implicated in an alleged scheme to perform hundreds of unnecessary open-heart surgeries at a Redding hospital formerly operated by troubled Tenet Healthcare Corp.
Instead, they agreed to settle civil claims, including allegations of improper billing, in exchange for $1.4 million each from cardiologist Chae Hyun Moon and surgeon Fidel Realyvasquez, and $250,000 from another surgeon.
Realyvasquez's surgical group also agreed to allow its insurance carrier to pay $24 million toward settling pending patient lawsuits.
Tenet will pay $1 million to the California Department of Insurance, which pursued a separate investigation.
In addition, the company, which sold the hospital after the scandal broke, agreed as part of Tuesday's settlement to add $5.5 million to the $54 million it consented to pay under an earlier settlement, reflecting the government's final accounting of its claims of fraudulent billing.
The deal all but closes the book on a high-profile scandal that began with an FBI raid on the hospital three years ago. The case threw the necessity of hundreds of surgeries into question and cast a giant shadow over the company. Moon and Realyvasquez, who maintain they did nothing wrong, said the settlement vindicated them.
Tenet, which also has admitted no wrongdoing, previously agreed to pay $395 million to resolve hundreds of patient claims. Tuesday's settlement brings the total payments pledged by all defendants since the surgeries first were disputed to more than $500 million.
The announcement appears to end one of many scandals that have battered the company in recent years.
A San Diego jury is expected this week to begin considering charges that Tenet's Alvarado Hospital bribed physicians to refer patients.
"This settles all significant litigation and investigations having to do with Redding," Tenet spokesman Harry Anderson said. Tenet shares rose a penny to $7.53.
Federal prosecutors said they decided against criminal charges in the case because they did not believe they could have obtained convictions.
One prosecutor, however, said that there was evidence that the doctors had put healthy patients' lives at risk.
"The evidence shows these doctors ran a high-turnover, high-volume surgery mill," Michael A. Hirst, assistant U.S. attorney in Sacramento, said in written comments.
