Dr. Emmanuel Hostin settles with American Transit, dropped from lawsuit

Dr. Emmanuel Hostin, husband of TV personality Sunny Hostin, settled with American Transit Insurance Co., and the insurer dropped him from its medical fraud lawsuit.

American Transit filed a stipulation of voluntary dismissal Tuesday for Hostin and Hostin Orthopaedics & Sports Medicine.

Hostin’s attorney, Daniel Thwaites, did not return a message left with his office on Wednesday. Thwaites steadfastly proclaimed Hostin's innocence for months.

American Transit, which insures taxi companies and Uber and Lyft drivers, filed a civil lawsuit Dec. 17. The lawsuit lists dozens of surgical centers, orthopedic services, and doctors and is reported to be one of the largest Racketeer Influenced and Corrupt Organizations Act cases ever filed in New York.

American Transit seeks to recover compensatory damages in excess of $153 million and treble damages in excess of $459 million. It has now settled with 161 of 180 initial defendants, according to court documents.

The insurer alleges that Hostin, who owns Hostin Orthopaedics, performed surgeries at other ambulatory surgical centers and billed American Transit through each of those entities “in exchange for kickbacks and/or other compensation which were disguised as dividends or other cash distributions” for an investment Hostin has in Empire State ASC, the lawsuit claims.

No-fault law blamed

American Transit traces its complaint to New York’s no-fault law, which states that plaintiffs are required to pay for health service expenses that are “reasonably incurred as a result of injuries suffered by occupants of their insureds’ motor vehicles, pedestrians, and bicyclists,” the lawsuit said.

Enacted in 1974, the no-fault law requires insurers to compensate covered persons for “basic economic loss,” which includes medical costs, incidental costs, and lost earnings. Across the country, officials are taking a closer look at no-fault laws enacted during the 1970s.

Personal line auto insurers that insure personal or private passenger vehicles are required to provide benefits up to $50,000 per person. Commercial auto insurers are required to provide up to $200,000 per person.

The alleged fraud was led by a group of ambulatory surgical centers from 2009 to the present, the lawsuit claims. Injured people were first treated at clinic, then transferred to an ASCs for “orthopedic and/or pain management evaluations,” the lawsuit said.

American Transit names 5,800 people who received such treatment “as part of the predetermined fraudulent protocol of treatment.”

The goal of the alleged fraud was always “to maximize reimbursement from insurers in general, and Plaintiff in particular, for No-Fault benefits for medically unnecessary services,” the lawsuit said.

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InsuranceNewsNet Senior Editor John Hilton has covered business and other beats in more than 20 years of daily journalism. John may be reached at [email protected]. Follow him on Twitter @INNJohnH.