MEDICARE FRAUD: UC HOSPITALS COME UNDER FIRE

      In a case with "broad implications," the five medical
 centers in the University of California (UC) system have been
 sued for Medicare fraud by two former employees, and could face
 "severe financial penalties," SAN DIEGO UNION-TRIBUNE reports. 
 Sources said that the medical centers are accused of defrauding
 the government by billing for care provided by faculty physicians
 when the services were actually provided by residents, interns or
 fellows.  The University of Pennsylvania paid $30 million last
 year to settle similar accusations.  
      WHISTLE WHILE YOU WORK:  Federal authorities are
 investigating the lawsuit, which was filed under the federal
 whistle-blower's law.  The law permits employees who "uncover
 financial wrongdoing to share with the government in any
 recovered proceeds."  The suit must remain confidential while the
 government decides whether the claim has merit and whether it
 will take over the suit.  If the government chooses not to pursue
 the suit, the whistle-blowers could pursue it on their own.  
 University officials denied any knowledge of false billing and
 said that they were cooperating with the investigation.
      IMPACT:  The UNION-TRIBUNE reports that any financial
 penalties resulting from the suit "could have a major
 administrative and financial impact on the medical centers,
 several of which are reeling from serious financial problems." 
 The University of California has medical centers in Davis,
 Irvine, Los Angeles, San Diego and San Francisco (Dalton, 7/13).