Nevada health network facing accusations of fraud

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Renown Health, a not-for-profit integrated health network in northern Nevada, is being sued by doctors at a Reno cardiology practice who allege that Renown attempted to defraud the doctors out of millions of dollars using deceptive tactics during negotiations to buy the cardiology practice, according to the Reno Gazette-Journal.

According to statements made to the Gazette-Journal, Renown officials said the lawsuit was “baseless” and that the negotiations were fair, generous and conducted with integrity.

The allegations of fourteen cardiologists from Sierra Nevada Cardiology Associates, now taken over by Renown Health, paint a different picture. They allege that their former executive director, Phil Schwebber, had been feeding Renown information during negotiations and lying to doctors in order to secure a deal more favorable to the provider, according to the Gazette-Journal.

Schwebber had previously worked for Renown before taking the job at Sierra Nevada Cardiology Associates in 2009, the year before the negotiations took place.

The doctors allege that Renown agreed to pay $450,000 in base pay per year, with an additional $157,000 in incentive pay subject to performance measures. In the final signed agreement, however, the doctors weren’t guaranteed that base pay and Schwebber refused to provide the doctors with copies of the compensation agreement, according to the Gazette-Journal.

Schwebber has since been rehired by Renown as a business development administrator.

The Nevada attorney general and the Federal Trade Commission had previously announced an investigation into Renown for possible antitrust violations in March. Renown confirmed that they were cooperating with what they referred to as an “informal inquiry,” but said it was not unexpected due to the size of the deal to acquire Sierra Nevada Cardiology Associates. That investigation is ongoing, according to the Gazette-Journal.