CINCINNATI — A federal judge unsealed a whistleblower lawsuit on Thursday accusing ProScan – one of the largest MRI-reading companies in the nation - of using physician assistants, instead of doctors, to improperly read hundreds of MRIs each day and wrongly diagnose patients.

“This lack of proper review has caused injury to patients whose images were mistakenly read as normal by the unlicensed readers and not properly reviewed by a qualified physician. Likewise, ProScan frequently misdiagnoses as serious – and even life-threatening – imaging findings that are of no consequence,” according to the lawsuit filed in U.S. District Court in Cincinnati.

The case has been under seal for two years. While the U.S. Department of Justice declined to intervene, they are allowing the two whistleblowers to litigate the case in the name of the United States, according to court filings.

This means while federal prosecutors sit on the sidelines for now, they can enter the case at any time.

"ProScan was contacted by the DOJ over a year ago with a request for information related to the government’s investigation of the allegations of the lawsuit. ProScan responded to the DOJ's requests, shared all requested information, and fully cooperated with the investigation. After the DOJ’s thorough review and consideration of all

requested information, the DOJ declined to pursue the case further," according to a statement from ProScan CEO and Medical Director Stephen Pomeranz and President Michael O'Brien.

The statement continued: "ProScan prides itself on its integrity and quality of care. We have always operated our business within strict adherence to compliant policies and procedures and will continue to do so. The allegations of the complaint are devoid of merit. ProScan is confident that the lawsuit will be dismissed."

The False Claims Act lawsuit was filed in October 2017 by a former ProScan radiology assistant, Jason Taylor, and Dr. Peter Rothschild, a California radiologist who developed the open MRI, holds an MRI patent and reviewed numerous ProScan reports after getting calls from doctors who had “grave concerns,” according to the suit.

The lawsuit accuses ProScan of submitting thousands of fraudulent claims for Medicare, Medicaid and Tricare reimbursement for MRIs that were not lawfully interpreted by a doctor, costing the government hundreds of millions.

They are suing ProScan Imaging, which is headquartered in Cincinnati and operates 25 freestanding imaging centers in seven states; and ProScan Reading, a teleradiology branch that interprets 2,000 MRIs a day for 500 hospitals and imaging centers nationwide, according to the lawsuit, which was amended in 2018.

The lawsuit accuses ProScan of using lower-paid physician assistants to “ghost read” MRI images resulting in frequent misdiagnoses and missed diagnoses.

“If these millions of MRIs were re-read by board-certified radiologists, the true scale of this tragedy would become clear,” the lawsuit states.

But ProScan insists that all of its radiology reports are reviewed and finalized by licensed board-certified physicians, according to a company statement..

In October 2017, a doctor asked Rothschild to review an MRI that had been performed at ProScan on one of her patients – a jockey who had neck and arm pain, headaches, numbness and tingling in both hands after a horse fell on him.

ProScan stated his MRI showed no acute injury, according to the lawsuit.

“Dr. Rothschild personally reviewed the MRI exam and was shocked by the numerous, life-threatening, obvious conditions, evident on almost every one of the eight sequences, that the physician assistant had missed,” according to the lawsuit.

Rothschild found two severe spinal cord injuries in the jockey’s neck and a complete tear of the ligament that stabilized his neck, according to the lawsuit.

“When this ligament is torn, the patient is at very high risk of becoming paralyzed from the neck down or, worse, expiring if he sustains any further injury or trauma. These serious conditions made the patient a ticking time bomb,” according to the lawsuit.

The lawsuit alleges the jockey’s images were read by a physician’s assistant, and the doctor whose electronic signature was on the report either never looked at the 200 images and batch-signed the report, or someone else ghost-signed for him, possibly without his knowledge.

In June 2017, Rothschild got a referral from a neurosurgeon for a second MRI to be done on a patient. The original MRI was performed at ProScan in Louisville, and read by a physician assistant who identified a tumor on the spinal canal, according to the lawsuit.

When Rothschild performed a second MRI, the alleged tumor turned out to be a normal vein, according to the lawsuit.

“No board-certified radiologist would mistake a vein for a tumor. Meanwhile, the patient most likely spent almost three months in mental anguish over the news that he had a spinal tumor. Had a physician even glanced at this case, this rookie error would have been caught,” according to the lawsuit.

The lawsuit alleges that it is not physically possible for ProScan, which employs 35 board-certified radiologists, to read 350,000 studies per year, as it advertised in 2018.

Also named as defendants in the lawsuit are Dr. Stephen Pomeranz, CEO and medical director of ProScan and founder of ProScan Reading, and Dr. Malcom Shupeck, associate medical director of ProScan and director of fellowship administration of the ProScan Imaging Education Foundation.

One of the alleged whistleblowers, Taylor, was hired to work in ProScan’s marketing and sales department in the company’s Jefferstown facility in 2015.

Taylor alleges that Pomeranz attempted to recruit him to become a “ghost reader” for ProScan by participating in a one-year, uncertified, secret training program, according to the lawsuit.

“Pomeranz made it clear that there would be great financial advantage to Taylor by doing so and that Taylor could make a lot more money as a ghost reader than he was making in the marketing department. Uncomfortable with this suggestion, Taylor declined, and did not renew his contract with ProScan when it expired in the spring of 2016,” according to the lawsuit.

U.S. District Court Chief Judge Susan Dlott unsealed the case on Thursday at the request of federal prosecutors.

The case has been reassigned to U.S. District Court Judge Michael Barrett.

