Washtenaw County’s top medical and legal official is seeking a record $4 million payment to the Lawrence Memorial Hospital after being ordered by a federal court to cover more than $2.4 million in indemnity and other costs incurred by the hospital following a federal criminal investigation.
The money will cover the hospital’s expenses as a result of a federal investigation by the Justice Department into the medical care of veterans.
Lawrence Memorial, a state-owned medical facility, is under investigation by U.S. Attorney John Fitzgerald and the FBI, which is investigating allegations of misconduct at the hospital.
The hospital is not in bankruptcy.
In its request, the county’s Health Care Trustee wrote that the hospital is “currently under a state of emergency” because of “a threat to the integrity of the hospital and the entire healthcare system.”
The court order came in response to a lawsuit filed by the county in December, which said the county owed $1.5 million for indemnity costs after being placed under a federal medical crisis declaration because of the investigation.
The lawsuit is still pending.
Lawrence Memorial Hospital has faced criticism from lawmakers for the way it handled the investigation, including a lack of transparency and poor treatment of veterans with PTSD.
In a letter to the county, the Health Care Department wrote that “the hospital has been the subject of an ongoing criminal investigation, and a federal grand jury investigation.”
“The federal government has determined that the county has breached its fiduciary duty to provide care for its veterans, and the court order is in place to prevent the hospital from violating this duty,” the letter said.
The county will pay $1,750 to the hospital each month for five years.
The order applies to all future medical costs and is retroactive to the beginning of 2018.
The county also will pay to the Medical Center Trust Fund $2,500 for each of the next two years for medical care for veterans in the county.
Lawyers for the hospital did not immediately respond to requests for comment.