Whistle-Blower Defends Suit Against County

Dr. Jerome Lance had a problem. The veteran psychiatrist felt that administrators in the county’s mental health agency viewed him as little more than a prescription writer.

Worse, Lance and other county psychiatrists had discovered that the county was billing Medicare for services it claimed were supervised by the doctors--even if the physicians had never seen the patient. Lance thought that was illegal.

Then county supervisors voted last year to merge the mental health and welfare agencies, a move the psychiatrists saw as further eroding their medical authority.

Feeling frustrated and powerless--and certain that the doctors’ concerns would not be taken seriously--Lance filed a whistle-blower’s lawsuit under the federal False Claims Act alleging that the county had cheated the government out of millions of dollars by submitting fraudulent Medicare claims.

“There was no other way to do it,” said Lance, speaking publicly for the first time about his September 1998 lawsuit. “We had gotten to the point where we tried to work it out within our system. And we could not break through.”

The slight, soft-spoken man nearing the end of his career launched an investigation that would eventually strengthen physician oversight of mental health services, but would also throw an already polarized county government into panic and cost taxpayers at least $15.3 million.

For Lance, 65, it was a 12-month roller-coaster ride, a tension-wracked way to wrap up a career spent treating people with schizophrenia, depression and post-combat stress disorders. And, ultimately, he said, it was an act that scored a philosophic victory for psychiatrists across the state.

“It was exhausting,” Lance said. “It was exhilarating. It was the year of living dangerously.”

The psychiatrist stands to receive a portion of the settlement for his role in alerting authorities to the irregularities. The amount has not yet been determined, but whistle-blowers in similar cases typically reap 15% to 17%, or about $2 million.

Reinstating Doctor Authority

But Lance said financial gain was not the reason he turned in the county. He was convinced that patient care would suffer if things were allowed to go on--and that doctors would be held liable for treatment they did not deliver.

“It made things intolerable to practice medicine,” he said.

Lance’s identity was released publicly by prosecutors Friday as they unsealed the lawsuit and made their first public comments on the civil fraud charges brought against the county. The Times reported Lance’s identity in July.

The Southern California Psychiatrist Assn. lauded Lance’s role in forcing the county to reassert physician authority. In recent years, psychiatrists’ role had been diluted in some counties by a team-based approach to treating people with mental illness, said Dr. Edward D. Titus, chairman of the group’s public psychiatry committee.

“There was a concern that patient care might be adversely affected by people who were not as professionally qualified as some in making treatment decisions,” said Titus, whose group strongly opposed the merger. “That situation had gone a little further in Ventura than in other counties.”

Not everyone is happy with the lawsuit’s outcome. Psychologists say physician-directed treatment downplays the importance of psychotherapy in helping mentally ill people ease back into society.

And many of Lance’s co-workers view him as a traitor, someone willing to put the county at financial risk for personal gain.

John Chaudier, former director of the county’s Mental Health Board, said employees in the Behavioral Health Department frequently call him to vent their frustration at the physician-heavy administration.

The psychiatrists insist the changes will benefit patients, Chaudier said. But many employees feel the doctors, including Lance, acted out of self-interest.

“Are they leading?” Chaudier asked. “Or are they protecting their own rice bowl?”

Inevitable Grumbling

Blowing the whistle did not harm Lance’s career. In fact, instead of being shunned, he was promoted. He is part of a new administrative team--which includes numerous psychiatrists--that is bringing broad changes to the way mental health services are delivered in Ventura County.

The doctor brushes off grumbling as inevitable. There are always complainers, he said. For the most part, the 400 employees in the Behavioral Health Department are working hard to bring about needed reform, he said.

“I don’t feel particularly that I am endearing to a lot of people,” he said. “But I do know people have moved forward to get the job done.”

When Lance was hired by the county in 1990, he looked forward to working in the public mental health clinics. Lance had heard of Ventura County’s pioneering system of bringing psychiatrists, psychologists, nurses and social workers together on teams to treat those with chronic mental illness and thought it would be a good chance to work at the community level.

He had done that in Los Angeles, working for 18 years in Veterans Affairs clinics helping Vietnam soldiers recover from the stress of combat. He wanted to be part of a progressive new movement of community-based care, Lance said.

But through the years, he said, doctors believed that their authority over medical care was being improperly subordinated to social welfare and rehabilitation treatment plans. On some teams, Lance said, doctors were being overruled on medical decisions by social workers, nurses and psychologists.

The doctors began asking for changes in 1996. Their agitation continued during the next three years, but nothing changed, Lance said. Then came the April 1998 merger of the Behavioral Health Department with the Public Social Services Agency, creating a much larger agency headed by administrators with backgrounds in social work.

The following month, psychiatrists Timothy Tice and David Gudeman sent memos to mental health administrators reporting that their physician ID numbers were being used to bill for services they had not ordered. Former mental health director Stephen Kaplan did some “superficial tinkering,” but substantial reform did not occur, Lance said.

Filing the Lawsuit

Unsatisfied, Lance soon consulted with Phillip E. Benson, an Orange County attorney who specializes in False Claims Act lawsuits. After hearing his story, Benson advised him to file a lawsuit in September.

“It really was not a decision that required much thought,” Lance said. “After speaking with Mr. Benson, I felt that this was the best way to protect the system. And actually that is exactly what has happened.”

Lance said he will continue working with Gudeman, who was appointed Behavioral Health Department director in June, to bring the mental health system into compliance with state and federal regulations. Once that is done, he will likely retire from county employment, Lance said.

He might teach a little or spend some time with his two grandchildren, Lance said. His two adult daughters, both attorneys, and his wife have been a source of support during the past year, Lance said. He shies away from questions about who is to blame for the billing mess, noting that an FBI investigation into possible criminal acts is under way.

“I have no wish to see criminal punishments,” Lance said. “But I do think when you are careless, you need to say, ‘OK, we made these mistakes on our watch.’ ”