It pays to do the right thing.
Mallavarapu’s continued efforts to get the word out about the fraud — and serious health problems Patel was creating for patients by performing procedures they didn't need (there were others who reported Patel, too) — eventually paid off. In 2004 Mallavarapu sued Patel under the False Claims Act, a federal civil fraud statute that allows individuals who have witnessed this kind of illegal activity to sue on behalf of the U.S. government under the statute’s qui tam provisions. Commonly called a whistleblower suit, the action allowed Mallavarapu to recoup a portion of the recovered money.
On Feb. 25 the last of three civil settlements was announced by U.S. Attorney Stephanie Finley, bringing Mallavarapu’s total take to $1.26 million plus $70,000 in attorneys’ fees.
“Awards to qui tam plaintiffs are mandated by federal statute,” Finley tells The IND in a written response. “When the United States intervenes in such qui tam suits, the relator, the person who files a suit on behalf of the United States under the False Claim Act’s qui tam provision, can receive a minimum of 15 percent but not more than 25 percent of the proceeds of the settlement, depending upon the extent of the relator’s contribution to the prosecution of the action. The False Claims Act also mandates the payment of the relator’s reasonable expenses such as attorney’s fees in a qui tam action.”
Below are the portions of each settlement and the expenses to Mallavarapu in the Patel case:
• Our Lady of Lourdes settlement (August 2006): 20 percent of the $3.8 million paid ($760,000) and $25,000 in attorneys fees and costs
• Lafayette General Medical Center settlement (January 2008): 20 percent of the $1.9 million paid ($380,000) and $25,000 in attorneys fees and costs
• Patel, Acadiana Cardiovascular Center, and Acadiana Cardiology settlement (February 2015): 18.5 percent of the $650,000 paid ($120,250) and $20,000 in attorneys fees and costs
Mallavarapu, whose local office number was disconnected and is no longer practicing in this market, according to one health care source, could not be reached for comment.
Patel, who once bragged of being the nation’s busiest cardiologist, is now serving a 10-year sentence.
Patel was indicted in 2006 on 94 counts of health care fraud, and a jury found him guilty of 51 counts in 2008 after a two-month trial. As Mallavarapu alleged, his procedure of choice involved the insertion of a coronary stent (a small tube shaped device) into the arteries of patients, some of whom, medical records in court showed, had no blockage at all.
In addition to the 120 months in prison and five years of supervised release, Patel was ordered to pay $387,500 in restitution and a $175,000 fine.
Patel was 67 when he began serving his sentence in late 2012. According to the 2013 Bloomberg story, tax returns revealed that by 2003 Patel’s income had reached $6 million a year. When Bloomberg published its story, he was earning $5 a month as supervisor of a cleaning crew at the Federal Correctional Complex in Oakdale.