Whole-body scanning chain Heart Check America has been hit with a class-action lawsuit filed by a Las Vegas attorney who claims that the firm defrauded customers by offering CT scanning packages without referrals from licensed physicians -- an alleged violation of Nevada state law.
In litigation filed August 6 in Clark County District Court, attorney George West III accuses Heart Check America of a variety of abuses, including breach of contract, deceptive trade practices, and conspiracy. The lawsuit also names Chase Bank and Conrad Acceptance, two consumer finance companies that provided loans to HCA customers buying long-term scanning packages.
The complaint filed in the case charges that Heart Check America operated an imaging center in Las Vegas for which it marketed electron-beam CT screening studies for indications ranging from heart disease to colon cancer. For the past six years, HCA entered into long-term medical service contracts for up to 10 years, in which customers would receive "substantial" discounts on radiological services compared to if the consumer came in once a year for the same screening study without a long-term contract, the complaint states.
Heart Check America marketed the contracts via advertising, as well as through "informational" seminars in Clark County, and it sold the packages for a one-time enrollment fee of $199 and an annual fee of $199, the complaint states. The scanning packages were often financed through a Chase product known as ChaseHealthAdvance, a revolving consumer credit account, with consumers obligated to make monthly payments directly to Chase.
The complaint further states that the radiological services covered by the long-term contracts could not be legally offered to Nevada consumers unless the exams were first specifically authorized by a licensed healthcare provider, and were ordered via a referral that identified the type of scan and a description of the specific part, organ, or portion of the body to the scanned. Heart Check America failed to disclose this law, Nevada Administrative Code (NAC) 459.554(3), to its customers, the complaint alleges.
"The HCA defendants were essentially entering into and/or facilitating the entering into of illegal contracts for medical services with the consuming public because said HCA defendants were in fact conducting such radiological imaging studies without any referral and/or authorization of a medical practitioner," the complaint states.
The complaint specifically mentions the case of plaintiff Kenneth Barth, who in March 2010 entered into a 10-year contract with the Las Vegas center. The contract called for HCA to perform annual studies on Barth, including scans of the heart, lungs, and pelvis, and one full-body annual scan, for a total of $3,995. Barth paid an enrollment fee of $199 and was to pay $199 annually for 10 years. Barth secured a contract with Chase for a ChaseHealthAdvance account to finance the package.
In May 2011, Barth attempted to schedule his scans for the second year of the contract, but discovered that the Las Vegas center was closed and the premises were vacated. Heart Check America's phone line had also been disconnected. At the same time, Barth continued to make payments to Chase Bank for financing his long-term contract.
Heart Check America began closing centers across the U.S. in April, after Colorado regulators ordered the company to stop scanning patients in the state without referrals from physicians. The state's Department of Public Health and Environment announced a $3.2 million fine against the firm earlier this month for a range of violations.
The Nevada complaint charges that HCA breached its contract with Barth, and it claims that he has suffered damages of up to $75,000. In addition to Barth's claim, the complaint seeks to have the lawsuit given class-action status on behalf of all Nevada consumers who in the previous six years have entered into long-term contracts longer than one year with Heart Check America, and who financed the contracts with ChaseHealthAdvance credit accounts.
The crux of the case is the fact that Heart Check America scanned patients without referrals, according to West.
"You are not allowed to give radiology imaging studies or exams on an outpatient basis without a specific referral from a licensed medical practitioner," West told AuntMinnie.com. "They signed [people] up like it was a regular old subscription service. You can't do that in most states, including the state of Nevada."
