Six doctors are charged with taking kickbacks for sending patients to Chicago hospital for no reason

An entire Chicago hospital operated on kickbacks, buying referrals of elderly patients who had no medical reason for admission, then billing Medicare and Medicaid for unneeded investigations and stays, say charges filed by US attorneys against five administrators and six doctors.

Conditions at Sacred Heart Hospital, in a deprived area of the city’s West Side, were so poor that the hospital “was required to purchase patients” from unscrupulous local doctors, disguising payments as office rent or teaching fees, the prosecutors allege.

By the time the hospital was raided in April 2013, conversations among senior staff were being routinely recorded for the FBI by a doctor and administrators who hoped to secure lenient treatment for their own acts. The hospital’s deputy chief executive officer and vice president, both cooperating sources for the FBI, recently entered guilty pleas in preliminary hearings. Prosecutors are expected to ask for lesser sentences of two and five years in prison in return for their cooperation.

But the evidence recorded did not permit the government to press charges on the gravest allegations made in the criminal complaint filed soon after the initial arrests: that doctors at the hospital deliberately suppressed patients’ respiration with heavy sedation so that they could perform lucrative tracheotomies that often ended in the patient’s death.1

The trial begins this month, and key details of the government’s case have just become public. Prominent among the defendants are the hospital’s chief executive officer, Edward Novak, 59, and Venkateswara Kuchipudi, 67, whom staff referred to as Chicago’s “king of nursing homes.” He had patients taken to Sacred Heart from his facilities …