Gamma Knife sues former Deaconess owner, alleging more than $500,000 in missed payments

Gamma Knife Spokane has sued Deaconess Hospital’s former owner, accusing hospital officials of bilking the company out of more than $500,000 in insurance payments.

Gamma Knife treated Deaconess patients with certain types of brain tumors, tremors and other disorders, using single doses of gamma radiation, according to the lawsuit filed this month in Spokane County Superior Court.

Deaconess was supposed to pay Gamma Knife a certain percentage of the amount the hospital received in payment for the radiation treatments, minus hospital costs, the suit said.

The state of Washington was one of the payers for the radiation services, along with Medicare, Medicaid and private health insurance companies. In 2013, the state began making quarterly payments for services performed by Gamma Knife at Deaconess, instead of monthly payments, the lawsuit said.

Gamma Knife’s owners became concerned when the payments from Deaconess dropped by 68 percent, according to the suit. Hospital officials erroneously responded that the state of Washington had reduced payments for gamma radiation treatment, the lawsuit alleges.

At the time, Deaconess was owned by Tennessee-based Community Health Systems, which denies the allegations. The hospital has since been sold to Multicare Health System, which is not involved in the lawsuit.

The dispute continued for three years. The state of Washington provided a spreadsheet to Gamma Knife this year, showing the amounts the state paid to Deaconess for Gamma Knife’s treatment of patients, the lawsuit suit said.

“As a result of the state’s accounting spreadsheet, (the plaintiff) learned funds had been paid to defendant hospital by Washington state for Gamma Knife services which (the hospital) failed to pay,” the suit said.

Deaconess withheld more than $500,000 that should have been paid to Gamma Knife for treating patients at Deaconess, said Bob Dunn, the company’s attorney. Gamma Knife is seeking damages in an amount to be proven at trial.

Tomi Galen, a Community Health Systems spokeswoman, said Deaconess paid all fees to Gamma Knife owed under the terms of the contract. CHS “intends to vigorously defend itself against this lawsuit,” she said in an email.