Does Discrimination Case Put UAB's Federal Funding At Risk?

A federal jury has found that the University of Alabama at Birmingham (UAB) discriminated against a medical resident from India based on her Hindu religion. But the implications of that finding could go way beyond Dr. Seema Gupta and her lawsuit.

Academic medical centers, including UAB, receive $100,000 per resident per year for graduate medical education (GME). That money comes from Medicare, and it represents a huge chunk of federal dollars flowing into Alabama. But here is the kicker: The funding is predicated on abiding by federal anti-discrimination laws.

A federal jury has found that UAB did not abide by federal law in its treatment of Seema Gupta. And she is only one of five international medical residents who left UAB's Huntsville program, claiming they were the victims of discrimination. So here is the bigger question: Has UAB put its federal funding at risk by treating international medical residents in a shabby fashion?

R.L. Kureel, a former member of Parliament and deputy leader of Lok Sabha in the Republic of India, was getting at that issue when he wrote a letter to U.S. Sen. Richard Shelby (R-AL) in May 2006, seeking help about discriminatory treatment of international medical graduates at UAB. Kureel is Dr. Seema Gupta's father. (See Kureel's complete letter to Shelby below.)

Shelby apparently ignored Kureel's request, but the legislator from India made it clear he understood the issues involved:

As a fellow legislator and senator from the state in question, I request you to take personal interest to investigate the facts of this case. As an attorney, I am well aware of the state sovereignty issues in this case. However, (Dr. Gupta's) training program is dependent and run by Medicare funding.

Does Kureel hold certain individuals at UAB in low regard? Sure sounds like it:

I am aware that laws for acts of discrimination currently exist and are enforced in the United States, and my daughter intends to seek justice. However, in a state-funded university (such as UAB), the particular individuals in question are typically not affected as Office of the Counsel of the university handles these cases. As a result, these renegade individuals continue to function, ignoring the laws in place, knowing their universities' legal procedures would protect them.

UAB, however, could pay a steep price for failing to keep its renegades in check. A former medical resident from Germany has a lawsuit pending. A former resident from Pakistan has filed a complaint with the U.S. Department of Labor.

The issue goes beyond medical training. UAB has a number of pending discrimination cases from veteran employees in the general university environment. Our research indicates that UAB is required to conduct all of its affairs in a non-discriminatory manner--if it intends to accept federal dollars. Could those cases, too, put UAB's federal funding at risk?

We are talking about huge dollars here. UAB receives more than $400 million a year in federal research funding, for example.

Consider the money at stake just in GME: As we noted above, UAB receives $100,000 per resident per year. It has 36 residents each year at Huntsville, so that means the university receives $3.6 million for that program. But our research indicates UAB has close to 1,000 medical residents total--most of them in Birmingham and Tuscaloosa. If our math is correct, that means UAB receives about $100 million a year for GME.

We should keep this in mind: UAB already has been found to have committed health-care fraud related to Medicare. As we have reported here at Legal Schnauzer, UAB paid a judgment of $3.4 million to settle a federal whistleblower case in 2005. One of the whistleblowers, a forensic accountant who was UAB's research-compliance officer at the time, estimated the total fraud at $600 million. So even though UAB admitted to defrauding the government in that case, it got off with not even a wrist slap--less than 1 percent of the total fraud.

Is UAB a serial offender when it comes to federal laws? Sure looks that way.

Will the university pay a heavy price someday? Well, UAB clearly has protectors in the federal government, including Richard Shelby. And there might be loopholes in the federal law that a big university can slip through.

We are researching those issues and will examine them more closely in future posts. But the record is clear: UAB has a history of violating federal anti-discrimination and anit-fraud law--and so far, it has pretty much gotten away with it.


India Letters to Richard Shelby