News | November 30, 2006

Hospital Sued for Improper Business Practices

Two whistle-blowers sued the University of Medicine and Dentistry of New Jersey, Newark, alleging that senior officials there retaliated against the employees when they sought to block improper business practices. School representatives declined to immediately comment. Kathryn Gibbons, 48, a former finance official at the university’s 488-bed University Hospital, alleged in a lawsuit that her superiors ignored her complaints about improper billing and cost-reporting practices for years and then tried to cover them up. Gibbons said she was forced into a leave of absence in February while seeking to identify physicians who had overbilled the hospital and subsequently was fired in June. She provided information to federal officials, whose investigation of the school led to a deferred prosecution agreement and the appointment of a federal monitor earlier this year. The lawsuit, which names top university officials including interim President Bruce Vladek, was filed in Middlesex County (N.J.) Superior Court.

In a lawsuit filed earlier this month, another whistle-blower at the institution alleged his efforts got him harassed and demoted, his pay lowered and his office moved to the lunchroom before he was given an armed escort off the premises. The employee, Michael Nappe, 55, a finance manager, is on administrative leave. The lawsuit, also filed in Middlesex County Superior Court, claims Nappe tried to report irregularities in the university’s business dealings with several suppliers of telecommunications and computer support services, which were receiving “large sums of money without supporting documents.” A July report by the federal monitor found that the university had paid $35.2 million for telecommunications services but had only approved spending $5.9 million.

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