Chesapeake Regional Medical Center charged with fraud, conspiracy related to unnecessary surgeries

CHESAPEAKE — A federal grand jury on Wednesday indicted a Chesapeake hospital on charges accusing the facility of health care fraud and conspiracy relating to unnecessary surgeries performed by one of its former surgeons.

The indictment alleges that Chesapeake Regional Medical Center granted privileges to Dr. Javaid Perwaiz from 1984 until his arrest in 2019, despite knowing his privileges had been terminated by another hospital for performing unneeded surgeries and that he’d been convicted of two federal felonies in 1996.

The charging document also claims that from 2010-19, the medical center, formerly known as Chesapeake Regional Hospital, collected roughly $18.5 million from procedures performed by Perwaiz.

In November 2020, a federal jury found the former OB/GYN guilty of 52 felonies at the end of a three-week trial in U.S. District Court in Norfolk. Perwaiz, now 74, was sentenced to 59 years in prison.

“After Dr. Perwaiz was convicted of performing irreversible hysterectomies and other medically unnecessary surgeries on women, we continued to investigate the role that CRMC played,” U.S. Attorney for the Eastern District of Virginia Jessica Aber said 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 today that CRMC was complicit in this horrifying scheme to place profits over patient care.”

From at least January 2010 to November 2019, the hospital and others allegedly allowed Perwaiz to perform surgeries, procedures and premature baby deliveries in violation of rules and regulations, while also defrauding various health care benefit programs, the indictment claims.

“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,” said Brian Dugan, Special Agent in Charge of the FBI’s Norfolk Field Office. “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.”

In a statement issued Thursday, hospital officials denied wrongdoing, and said the facility is dedicated to patient safety and high-quality care.

“Chesapeake Regional Healthcare is aware of today’s legal action against its hospital, Chesapeake Regional Medical Center. It considers the allegations by the U.S. Attorney’s Office to be unfounded and an excessive overreach, and will respond more fully in court through its external counsel, Oberheiden P.C.,” the statement read.

“Chesapeake Regional is dedicated to patient safety, prioritizing high-quality care that meets rigorous national standards. Safety protocols are continually monitored to ensure the greatest level of care protecting the health and welfare of patients, families, and staff.”

The indictment alleges Perwaiz routinely scheduled unnecessarily early baby deliveries at the hospital on Saturdays, when he was already set to be there for surgeries.

“CRMC knowingly disregarded patient care and allowed Dr. Perwaiz’s unnecessary surgeries, in order to increase its own revenue,” Maureen Dixon, a special agent with the U.S. Department of Health and Human Services, Office of Inspector General, said in a statement.

The indictment also claims the hospital knew Perwaiz misclassified inpatient surgeries as outpatient but allowed him to continue performing them. The hospital also allegedly knew that certain health care benefit programs would not reimburse for inpatient procedures done on an outpatient basis, that the majority of private health care benefit programs reimbursed such procedures at a much lower rate, and that inpatient surgeries require an increased level of scrutiny.

In addition, the hospital knew Perwaiz often scheduled Saturday surgeries on late Friday afternoons, and performed sterilizations on Medicaid patients without valid consent forms, the charges claim.

Perwaiz was a solo practitioner when he applied for privileges at Chesapeake Regional in 1983, the documents said. While his application was pending, Maryview Hospital in Portsmouth notified Chesapeake Regional’s president that Perwaiz’s privileges there had been terminated for performing unnecessary surgeries.

Chesapeake Regional’s surgery department initially declined his application, but later granted him privileges in April 1984, the indictment alleges.

In 1995, Perwaiz was indicted on six counts of felony tax fraud. He pled guilty to two counts, and admitted to extensive fraudulent conduct, including falsely claiming a Ferrari luxury sports car as an ultrasound machine so that he could write it off as a business expense, the indictment claims.

The indictment also alleges that Chesapeake Regional reviewed the credentials of its physicians every two years, and that Perwaiz’s packet included information about his felony conviction, his prior hospital suspension, and notes about medical malpractice lawsuits filed against him. Yet the hospital continued to give him credentials approximately every two years between 1984 and 2019, the indictment said. He was last re-credentialed in June 2019, five months before his arrest.

Jane Harper, jane.harper@pilotonline.com

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