CAMERON (August 21, 2013) -- Lawyers for Dr. Tariq Mahmood, the Texas physician under federal indictment for Medicare and Medicaid fraud, and attorneys representing stakeholders of Central Texas Hospital in Cameron, have worked out a settlement to prevent the permanent closing of the hospital.
The Cameron hospital remains open, but is only providing emergency room services directed by Rockdale-based Little River Medical Center.
In July, an administrator told hospital property owners known as CTH Inc. that, “the hospital was closing its doors and shutting down,” according to court documents.
The hospital was emptied of patients and about 70 staff members were furloughed after CTH Inc. moved to evict Mahmood and staff from the property.
CTH Inc., which leased the facility to Mahmood, won a temporary restraining order against him in an effort to keep the facility open and protect hospital equipment and documents.
“It was a scary situation for us, the community does not need to lose this hospital," Humble said.
The action by CTH Inc. likely blocked Mahmood's effort to close the facility.
Two other hospitals, one in Terrell and one in Center, have closed as a result of federal and state investigations that have targeted Mahmood.
Central Texas Hospital was turned over to Milam County Sheriff David Greene who is currently in control of the hospital by court order.
Now, Humble says Mahmood and his attorneys have reached a settlement with CTH Inc., under the terms of which Mahmood is to give up the operating license for Central Texas Hospital, and never to set foot in it again, according to Humble.
“The only issue that remains is a claim he has to personal property in the hospital," Humble said.
Mahmood is expected to create a list of what he owns in the hospital and CTH Inc. will review the list with him.
However, Humble says he has not seen a list yet.
Now, CTH Inc. must sign a new owner and operator, and give Central Texas Hospital a major facelift to keep it afloat.
“We need a new boiler, a new roof for the hospital, a new roof for the clinic, we discovered an unpaid utility bill estimated at $59,000, and other unpaid taxes,” Humble said.
According to humble, maintenance repairs and efforts to bring the hospital to proper regulations will cost anywhere from $500,000-$1,000,000.
Little River Medical Center is likely to take over the hospital according to Humble.
“We just haven’t had time to sign a lease with them yet,” he said.
Humble went on to say that the settlement between CTH Inc. and Mahmood is expected to be finalized within the coming weeks.
Mahmood, 61, from Cedar Hill, on April 11 was named in the indictment by a federal grand jury in the court's Eastern District of Texas, based in Tyler, and is charged with conspiracy to commit more than $1 million in health care fraud in nine separate counts.
Court records show Mahmood owns five hospitals in Texas, including the Central Texas Hospital, Cozby, Germany Hospital in Grand Saline, Renaissance Terrell Hospital in Terrell, Community General Hospital in Dilley, Shelby Regional Medical Center in Center, and the facilities in Cameron.
Mahmood also owned a clinic in Whitney which was closed and recently bought by Frontier Hospitals, Inc.
Mahmood, who has denied the charges, appeared before U.S. Magistrate John D. Love in April and his bond was set at $25,000.
Mahmood was released from custody after posting the bond and surrendering his U.S. passport to the Tyler court.
U.S. Attorney for the Eastern District of Texas John M. Bales said the Tyler grand jury indicted Mahmood for reporting more than $1.1 million in fraudulent health care charges to Medicare and Medicaid.
Bales said evidence shows Mahmood used Medicare and Medicaid provider numbers issued to hospitals he owns and operates.
He could face as much as 10 years in federal prison on each charge if convicted, Bales said.
In the indictment, a copy of which was obtained by News 10, alleges that from April 2010 to April 2013, Mahmood conspired with others to devise and implement a scheme to submit fraudulent claims for reimbursement through both the Medicare and Medicaid systems.
In the documents presented to the grand jury, prosecutors allege the conspirators received more than $375,000 in fraudulent claims by changing or altering billing and diagnostic coding.
Agents of the FBI, the Texas Attorney General's Medicaid Fraud Unit, the U.S. Department of Health and Human Services Office of the Inspector General and the U.S. Postal Service worked together to complete the investigation, the court complaint said.
Because the case still is under investigation, a spokesman for the U.S. Attorney's Office declined to comment further, saying additional indictments and charges could be forthcoming.