CHESAPEAKE, Va. (WAVY) — Chesapeake Regional Medical Center (CRMC) has been charged with healthcare fraud and conspiracy to defraud the U.S. as well as interference with government functions after a federal grand jury returned an indictment Wednesday.
The hospital, as alleged in the indictment, gave privileges to Javaid Perwaiz from 1984 until he was arrested in 2019, even after knowing he had been terminated at another hospital for performing unnecessary surgeries, and that, in 1996, he was convicted of two federal felonies.
From 2010 to 2019, the hospital allegedly received about $18.5 million in reimbursements from healthcare benefit programs for surgical and obstetric procedures that Perwaiz performed at the hospital.
“After Dr. Perwaiz was convicted of performing irreversible hysterectomies and other medically unnecessary surgeries on women, we continued to investigate the role that [Chesapeake Regional Medical Center] played,” said Jessica D. Aber, U.S. Attorney for the Eastern District of Virginia, in a statement. “As alleged in the indictment, Dr. Perwaiz did not act alone in this conspiracy to needlessly sterilize and otherwise harm women. The grand jury found … that [the hospital] was complicit in this horrifying scheme to place profits over patient care.”
According to the indictment, both the hospital and Perwaiz had agreed to allow him to keep performing the surgeries, which were considered in violation of the rules and regulations of the healthcare benefit programs. In addition, the hospital allegedly defrauded Medicare, Medicaid, TRICARE, Anthem, Optima, Humana, Cigna, Aetna, United and others in order to receive reimbursements for obstetric deliveries for no medical reason before 39 weeks of gestation.
“These latest charges are the next step toward justice for the women that were significantly impacted by Perwaiz’s predatory actions, as well as the negligence of Chesapeake Regional Medical Center,” Brian Dugan, Special Agent in charge of the FBI’s Norfolk Field Office, said. “The hospital’s prioritization of profits jeopardized the safety of many of their patients, many whom had full trust in them to provide reliable medical care. The FBI and our partners will continue to hold all parties responsible who abuse positions of power in such a manner, and that’s what today’s charges reflect.”
Chesapeake Regional Healthcare, in a statement, said that “it considers the allegations by the U.S. Attorney’s Office to be unfounded an an excessive overreach, and will respond more fully in court through its external counsel.”
The indictment also alleges that Perwaiz performed the obstetric deliveries exclusively at CRMC, regularly scheduling the elective inductions on Saturdays when Perwaiz was already scheduled to be at the hospital to perform surgeries.
To schedule the deliveries, the indictment alleges that Perwaiz submitted obstetric flowsheets to the hospital, which often had two different delivery dates — one due date accurate and within the standard of care, while the other was fabricated to appear as if the patient was at or after 39 weeks of gestation at the time of delivery.
According to a review for Medicaid patients in 2019, approximately 64% of the forms were found to be altered, ultimately resulting in around 39% of Perwaiz’s patients being induced before 39 weeks of gestation for no medical reason. The indictment alleges the hospital was aware of the changes, but continued to allow Perwaiz to continue the practices.
“As alleged in today’s indictment, CRMC knowingly disregarded patient care and allowed Dr. Perwaiz’s unnecessary surgeries, in order to increase its own revenue,” Maureen Dixon, Special Agent in charge for the U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG), said. “HHS-OIG and our law enforcement partners are committed to investigating allegations of patient harm and theft from federal health insurance programs.”
CRMC allegedly was aware that Perwaiz regularly misclassified inpatient surgeries as outpatient procedures, allowing him to continue to perform the surgeries. In addition, the hospital also allegedly knew that some health care benefit programs would refuse to reimburse a hospital for inpatient procedures performed on an outpatient basis, that most private health care benefit programs reimbursed the procedures at a lower rate, and that the inpatient surgeries were more scrutinized.
“Ensuring the full measure of justice is brought to all those complicit in the heinous acts committed by Dr. Perwaiz is of the highest priority,” Special Agent in charge Christopher W. Dillard of the Defense Criminal Investigative Service, the law enforcement arm of the DoD’s Office of Inspector General, said. “Today’s announcement demonstrates our commitment to work with our partner agencies to pursue individuals and corporations for fraudulent actions, particularly those that involve patient harm.”
Perwaiz was also allegedly allowed by the hospital to perform his surgeries outside of the scheduling policies for non-emergent surgical cases, often performing his Saturday surgeries on late Friday afternoons. Perwaiz also was said to have performed sterilizations of Medicaid patients without the valid consent forms. The hospital allegedly knew this and allowed him to continue to perform the sterilizations.
In September 1983, Perwaiz, who was a solo practitioner at the time, applied for privileges at CRMC, as alleged in the indictment. The hospital’s president at the time, Donald Buckley, who remained the president and CEO until 2005, had allegedly been notified by Perwaiz’ previous place of employment, Maryview Hospital, that Perwaiz was terminated for performing unnecessary surgeries.
At first, according to the indictment, CRMC’s president declared Perwaiz unacceptable for appointment but later granted him privileges in April of 1984.
Perwaiz, as alleged in the indictment, continuously conducted office visits, in-office diagnostic procedures, inpatient and outpatient surgical procedures and obstetric deliveries — including hysterectomies — at the hospital up until his arrest on Nov. 8, 2019. Most of the procedures were said to have taken place on Saturdays.
In addition to the alleged procedures, in 1995, Perwaiz was indicted on six counts of felony tax fraud. Perwaiz ended up pleading guilty to two of the counts and admitted to “extensive fraudulent conduct, including falsely claiming a Ferrari as an ultrasound machine so he could write it off as a business expense.
In November 2020, one year after Perwaiz was arrested, he was convicted of 52 counts of health care fraud and false statements, and was sentenced to a total of 59 years in prison. Around 38 of those counts were for procedures conducted at CRMC.
Former Perwaiz patient Linda Jackson isn’t surprised by the indictment, and thinks it is long overdue.
“Because at that time, I feel like he was doing unnecessary surgeries and I put that in my complaint,” Jackson said. “They say they investigated and they said they didn’t find anything wrong, which I feel like if they had investigated it further, it could have saved me and a whole lot of other people, other women, you know, the heartache and pain that they know they had to go through.”
As part of our investigation in 2020, Jackson told 10 On Your Side that she wrote to the Virginia Board of Medicine she thought Perwaiz had done.
She is concerned that what was going on with Perwaiz had apparently gone on for years.
Back in 1996, a local OB/GYN known as W.R. in the indictment, continued to express concerns about Perwaiz.
“I believe Dr. Perwaiz has returned to the type of behavior that has had him dismissed from two hospital staffs, convicted of two felonies, an admission that his lifestyle was out of control, and that he had bribed health professionals to maintain his practice,” the local OBGYN said in the indictment.
W.R. “estimated that about 2/3 of Perwaiz’s patient surgeries were medically unnecessary.”
“I feel angry because he has people’s lives in his hands,” Jackson said. “We trusted that doctor, and we trusted the people that did the credentialling of people. They looked into his background … and nothing was done.”
According to the indictment, the CEO’s of the hospital reviewed the credentials of their physicians, including Perwaiz, every two years.
Perwaiz’s re-credentialing packet allegedly had all of the information regarding his felony conviction, hospital suspension and notes of medical malpractice lawsuits. His was last re-credentialed just five months before his arrest.
The full indictment can be read in full below:
Anyone who believes they may be a victim in this case or who has information regarding this matter is urged to contact the HHS-OIG tipline at 1-800-HHS-TIPS /1-800-447-8477 or online at tips.oig.hhs.gov.
