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This week the FBI made several arrests at Sacred Heart Hospital on Chicago’s West Side arising out of an elaborate kickback scheme involving everything from unnecessary sedation to penile implants, all fraudulently billed to Medicare and Medicaid.  Specifically, the FBI has alleged that the Hospital has been endangering patients by intentionally over-sedating them and then performing unnecessary tracheotomies in a bid to boost profits. Additionally, the FBI alleges that there was a system to admit nursing home patients to the Hospital irrespective of any medical necessity by using certain ambulance companies allegedly in on the scheme that were able to transport them as emergency room patients and directly bill Medicare.

The arrests include the longtime owner of the hospital, the hospital’s executive vice president and chief financial officer and four of the hospital’s affiliated doctors in connection with a scheme that prosecutors said netted more than $225,000 in cash and at least $2 million in health care program reimbursements. The Hospital allegedly concealed these kickbacks to doctors as fictitious rental payments, ghost contracts or payments to teach nonexistent medical students. The U.S. Attorney has hinted that more arrests are forthcoming including additional doctors and hospital administrators.