Newark, NJ - The University of Medicine and Dentistry of New Jersey (UMDNJ) paid at least nine local cardiologists as much as $150 000 to refer their patients to the university's cardiac surgery program, which was under threat of closure for poor performance, according to an article in the Newark, NJ Star-Ledger [1].

The newspaper reports that the cardiologists were made "clinical assistant professors," but despite having contracts stipulating a range of services they were expected to perform, the doctors did not spend much time at the university, and the appointments were actually just a scheme to get around federal law that forbids payment for patient referrals. The article claims that UMDNJ's plan was to increase the number of cardiac catheterization procedures performed at University Hospital, which would ultimately lead to more cardiac surgery procedures.

The article, which appeared in the Star-Ledger on Sunday, November 5, 2006, notes that the controversy over the cardiologists came to light after the university's former chief of the division of cardiology, Dr Rohit Arora, filed a wrongful-termination suit against the university, charging that UMDNJ broke the law and then forced him out when he objected to the plan. Arora, now a professor of medicine at Chicago Medical School, is quoted as saying the faculty appointments were essentially a sham to mask illegal payments to doctors and were "immoral and totally unethical." Shortly after Arora questioned the legality of the program, he was denied tenure and demoted and his contract was not renewed, the newspaper reports.

The Star-Ledger writers, Ted Sherman and Josh Margolin, note that the university denied the allegations in a court filing but later withdrew its motion for summary judgment and paid Arora $2.2 million as a settlement, without admitting any wrongdoing. It said the decision to settle was a business one, driven largely by its insurance carrier, and that Arora's contract was not renewed to reduce expenses. It defended the cardiology hires, saying in court papers that the doctors were on call when necessary and provided training for students.

The article reports that the decision to hire the local cardiologists came four years ago, when the state was threatening to shut down the cardiac surgery program at UMDNJ because the hospital was not performing the state-mandated annual minimum number of 350 surgeries required to maintain accreditation and its mortality rate was too high. According to Arora, soon after the state issued its warning about the surgery program, the university embarked on a plan to enlist local cardiologists with large practices who could bring more patients to the hospital, Sherman and Margolin write.

They also quote several experts explaining that the federal statutes on patient referrals rule that hospitals cannot provide financial incentives to doctors to get patients, to ensure that doctors refer patients to the best places, regardless of their financial relationships. But they say that sometimes the rules can leave room for interpretation. "If someone is hired in a consulting function and does no work at all, then clearly you have a sham arrangement that can be prosecuted. In most cases, though, if a physician [is] brought on to head a department or a program and he performs some of those functions—then you get closer to the line and the issue becomes much more debatable," one lawyer is reported as saying.

Sherman and Margolin note that on its website, the university describes the part-time faculty members as "leaders in their field [who] hold academic appointments at the New Jersey Medical School and often teach classes." But Arora challenged this view. "If you look at their résumés and CVs, these were not doctors who were academic. They were never teachers. They're private practitioners with offices," he told the Star-Ledger.