Wichita cardiologist Joseph Galichia has filed a lawsuit against Continental Casualty Co., alleging that the insurance company breached its contract by refusing to pay after he settled claims with the federal government.
The lawsuit stems from a $1.34 million settlement that Galichia and his Galichia Medical Group agreed to with the federal government in 2009 to settle allegations that they submitted false claims to Medicare, the program that provides coverage for older Americans.
The settlement agreement said it was neither an admission of liability by Galichia and the medical group nor a concession by the government that its claims weren't well-founded.
The lawsuit, filed in U.S. District Court, asks that Continental Casualty pay the $1.34 million plus interest, attorneys' fees and litigation expenses.
Wichita attorney Coy Martin of Moore Martin, who filed the lawsuit, said that as a matter of policy he does not comment on pending cases. Galichia did not return a call for comment.
Continental Casualty also did not return a call for comment.
The lawsuit said Galichia's policy had been in effect from Feb. 1, 2004, "at least until April 24, 2005," and had a liability indemnity limit of $3 million.
The government's case against Galichia began in August 2004. By Feb. 3, 2005, Continental Casualty had been notified of the government's claims, the lawsuit said.
In August 2005, Continental Casualty agreed to pay for Galichia's defense costs. In June 2009, it agreed to pay the hospital's defense costs as well, the lawsuit said. It also has paid audit costs incurred by Galichia and the hospital.
Continental Casualty was notified in January 2008 that the government had offered to settle the case, and a month later it was asked to consent to the settlement. The lawsuit said the insurer denied any obligation to pay any part of the settlement.
The lawsuit reiterated that Galichia "does not concede liability or wrongdoing of any kind" in the settlement agreement, which was reached "to avoid the delay, uncertainty, inconvenience, and expense of protracted litigation."
It said Continental Casualty was "repeatedly called upon to reconsider its coverage denial" but "has refused to provide the indemnity for the settlement."