A longtime heart doctor in Ashland performed hundreds of needless procedures in a scheme to make money by defrauding federally funded health care programs, a grand jury has charged.
The federal grand jury indicted Richard E. Paulus, 68, Thursday on one count of fraud and 26 counts of putting false information in patients' records to justify unneeded heart surgeries.
From 2006 to 2011, Paulus billed Medicare for more heart catheterization and stent procedures than any other cardiologist in the nation, the indictment said.
Paulus was licensed in Kentucky in 1992. He sold his practice to King's Daughters Medical Center in 2008 and then worked under an agreement with the hospital to do heart procedures, the indictment said.
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A separate federal civil claim alleged that Paulus got paid based on the volume of procedures he did, an arrangement the hospital called "eat what you kill."
From 2006 to 2012, King's Daughters received more than $30 million for surgeries performed by Paulus, the indictment said. The hospital in turn paid Paulus more than $10 million from 2009 through 2013, according to court documents.
Paulus retired in 2013 while under investigation.
An attorney representing Paulus, Robert S. Bennett, said the charges were baseless, outrageous and unfair, and that Paulus will vigorously fight the indictment.
"During his more than two decades practicing medicine in Ashland, Dr. Paulus always put his patients first and always acted in their best interests. He never made any false statements about their care," Bennett said.
Bennett and another attorney in his Washington, D.C. firm will represent Paulus with Kentucky defense attorney J. Guthrie True, whose office is in Frankfort.
Paulus is scheduled to be arraigned this month. The maximum sentence on the fraud charge would be 10 years, and five years on the charges of making false statements.
The Kentucky Board of Medical Licensure was considering sanctions against Paulus before federal authorities asked the board to defer action. A consultant for the board had concluded Paulus provided improper care and that his practice of medicine constituted a danger to patients, though he denied wrongdoing.
King's Daughters agreed last year to pay the government $40.9 million to settle a similar lawsuit alleging it knew Paulus and other doctors were performing surgeries that were not medically justified.
The hospital did not admit wrongdoing, but agreed to internal reforms and to increased monitoring of its claims to federal health care programs.
The charges and lawsuit against Paulus follow other federal cases involving alleged high-dollar health care fraud.
In 2014, St. Joseph Health System agreed to pay $16.5 million to settle accusations that doctors at its hospital in London performed hundreds of unnecessary heart surgeries to pad the bottom line.
One of the doctors named in the settlement, Sandesh R. Patil, pleaded guilty to lying about the severity of a patient's condition to make sure the government would pay for a heart procedure. He was sentenced to 30 months in prison.
In another Kentucky case, two doctors, their addiction-treatment business and a drug-testing lab in which they had an interest agreed to pay $15.75 million to settle allegations of billing health programs for unnecessary drug tests on clients.