STATEN ISLAND, N.Y. -- A former Staten Island University Hospital doctor who was famously accused of forcing Beatle George Harrison to sign a guitar on his deathbed has agreed to pay out $2.35 million to resolve a Medicare fraud lawsuit.
Dr. Gil Lederman -- who used to run SIUH's radiation oncology department -- on Monday settled a decade-old lawsuit filed by whistleblower Elizabeth Ryan, a Florida Realtor and the widow of a former SIUH cancer patient. The federal government joined Ms. Ryan's lawsuit in 2008.
The lawsuit alleged that Lederman and SIUH violated the False Claims Act from the mid-1990s to 2003, advertising that the hospital's Stereotactic Body Radiosurgery program had a "95 percent success rate" in treating several types of cancer.
"With their scheme of fraudulent, false, misleading and deceptive advertising, defendants sold false hope to desperate cancer patients and their loved ones in order to unjustly enrich themselves and lured dying patients (Medicare and Medicaid beneficiaries) away from appropriate and less expensive methods of treatment," Ms. Ryan and the federal government alleged in their lawsuit.
SIUH agreed to pay than $25 million in September 2008 to settle the case, as part of a total $88.9 millionthe hospital agreed to pay to federal and state authorities to settle claims that it overbilled or improperly charged Medicaid, Medicare and TRICARE, the military's health insurance program.
The government had also accused Dr. Lederman of "miscoding his claims to falsely indicate he had treated patients above-the-neck in order to get paid by Medicare," officials with U.S. Attorney Loretta E. Lynch's office said in a statement Monday.
Medicare had limited coverage for stereotactic radiosurgery to above-the-neck treatment only at the time.
He was accused of filing false claims in connection with 300 patients.
Said Ms. Lynch in a prepared statement, "Providers who misrepresent their services -- whether for the purpose of obtaining greater reimbursem*nt or in an effort to conceal the fact that a treatment was deemed investigational -- continue to pose a threat to Medicare, our nation's largest insurer. In response, we will continue to vigorously pursue those providers who place their own self-interest above their obligation to accurately report the nature of the services they provide to their Medicare patients."
Dr. Lederman, who did not admit liability, agreed to pay $2,175,000 to the government within 10 days, $326,250 of which will go to Ms. Ryan, as well as an additional $175,000 to cover her legal fees.
Dr. Lederman now runs"Radiosurgery New York," a Manhattan-based practice specializing in stereotactic radiosurgery.
In a three-page statement issued Monday,his attorney, Jack Tracy, denied any wrongdoing, and said the settlement "puts an end to what was a legal nightmare for Dr. Lederman lasting ... more than 10 years.
"Although the case was near trial, appeals and further proceedings would likely last several more years. Dr. Lederman was willing to continue his fight for vindication and justice, however, the threat of losing his Medicare privileges and thus his ability to continue to help his patients, which was and is his primary goal, convinced him to settle the case and move on with his practice."
Lederman was a prominent figure in cancer treatment throughout the 1990s and early 2000s, with his voice regularly broadcast on radio advertisem*nts for Staten Island University Hospital. His stereotactic radiosurgery program attracted patients from around the world, but in January 2004, a $10 million lawsuit from the family of Beatle George Harrison brought him a different kind of notoriety - the suit alleged that he coerced the terminally ill music icon into signing his son's guitar.
He settled the resulting legal dispute not long after, then left SIUH for Manhattan's Cabrini Medical Center.
In May 2004, a month before Ms. Ryan filed her suit, a jury found him partially responsible for treatment given to a West Brighton cancer patient in a suit that resulted in a $5.5 million malpractice award.
In May 2010,a federal jury found that Dr. Lederman and an associate committed malpractice in treating a Sicilian patient, but determined their actions did not cause her death. The woman was one of 20 Italian nationals who claimed Dr. Lederman lured them to Staten Island University Hospital for cancer treatment with unrealistic promises of cures. She did not receive a monetary award.
All 20 patients died shortly after receiving the cancer treatment, which, they allege, was aggressively marketed between 2001 and 2003 and later discontinued.
In 2009, Senior District Judge I. Leo Glasser dismissed 18 of the 20 lawsuits against the doctors, ruling the plaintiffs had not proven medical malpractice or deception. The family of one of the two remaining patients later withdrew its claims. All the allegations against the hospital were dismissed.
The text of the settlement agreement can be found below:
The full text of the lawsuit can be found below:
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