January 16, 2003

Dear Colleagues:

You may have heard today about a lawsuit the Federal government has filed against The Johns Hopkins Hospital regarding billing for "procedures involving experimental cardiac devices." Our position is that the patients received the best available care, and the billing to the government was appropriate.

In 1986, Medicare issued a policy which, if implemented, would have created two standards of care - one for Medicare patients and one for everyone else. This policy was issued without proper notice to providers or to beneficiaries of the Medicare program and was rescinded in 1995. Now, approximately eight years after rescinding the policy, the Department of Justice is alleging that billing for those devices during the period 1986 to 1995 was fraudulent.

We believe the policy was invalid, unenforceable, and discriminatory against Medicare beneficiaries. The government paid for the use of these medical devices in FDA approved clinical trials for many years, and continues to do so. We feel confident that the position that we and some other academic medical centers have taken will prevail.

Sincerely,