UW to pay $950,000 for surgeon to leave

H. Richard Winn, the acclaimed University of Washington neurosurgeon who pleaded guilty to obstructing a federal investigation, will receive at least $950,000 and up to $3.7 million for resigning from the university.

None of the money will come from taxpayers. UW Physicians, the billing arm for UW doctors, and nonpublic revenues generated by the UW Academic Medical Center will pay Winn. Both entities generate hundreds of millions of dollars in annual billings.

UW officials said they agreed to the pact to avoid a costly effort to remove Winn that would have led to further upheaval.

Winn signed a separation agreement July 16, the day he pleaded guilty to a felony obstruction charge under a deal with federal prosecutors.

As part of the plea deal, Winn agreed to pay $500,000 to the government for improper billings submitted to Medicare, Medicaid and a Defense Department medical program by the UW neurosurgery department.

Winn also agreed to resign from the university, effective Aug. 31.

Under the separation agreement, Winn, 60, is guaranteed $950,000, with the remainder based on his ability to find a new position.

He also will not be required to repay more than $500,000 that UW Physicians paid for his legal fees as part of its contractual obligation to defend him. Winn, who was chairman of the neurosurgery department for nearly 20 years, had earlier agreed to repay UW Physicians if he were convicted in the case.

His separation agreement was provided to The Seattle Times yesterday under a public-records request submitted to UW.

L.G. Blanchard, spokesman for the UW Academic Medical Center, said the agreement spared the university a prolonged battle in which Winn would have fought its plans to remove him.

"This lengthy process would have been divisive, prolonging the damage to the university, the faculty and the residency program," Blanchard said.

The financial costs of removing Winn, who would continue to be paid during an appeal, likely would have "equaled or exceeded even the highest amounts allowed under the separation agreement," Blanchard said.

"The university sought to resolve its relationship with Dr. Winn and to move forward."

Under the agreement, Winn is to be paid a lump sum of $200,000. He also will receive monthly payments totaling $750,000 from Sept. 1 to Aug. 31, 2003.

Those payments are guaranteed, minus normal withholdings such as income taxes and Social Security.

Winn also would be paid $750,000 during the following one-year period, and $500,000 annually for four years through Aug. 31, 2008, if he is unable to find a job.

Winn must make a good-faith effort to find employment as a neurosurgeon. But the agreement specifies that the position has to be at a "highly regarded academic institution in a geographic area acceptable to him."

If he finds a position, the additional payments would be reduced by whatever amount he earns. If his pay exceeds the sums, the payments would end.

Winn's annual salary averages more than $700,000, Blanchard said.

UW officials said they are confident that Winn, despite his guilty plea, will be able to find a position given his reputation as one of the top neurosurgeons in the country.

Winn's attorney, Cyrus Vance Jr., said yesterday that Winn's efforts to secure a new position were "in process." He declined to elaborate.

Concerning Winn's departure, Vance said, "The university believed a separation agreement with Dr. Winn was appropriate, in the best interests of the university and the Department of Neurosurgery and a recognition of Dr. Winn's contributions to the institution over many, many years."

Some of the $200,000 lump sum paid to Winn may be used for further legal fees he might face, including matters involving his medical license, federal grants and ability to collect fees from Medicare and Medicaid, according to people familiar with the agreement.

Winn was the first doctor at a medical school to be convicted of a crime in the government's seven-year examination of Medicare and Medicaid billings at teaching hospitals nationwide. Other cases were resolved with large civil fines paid by the hospitals.

Winn pleaded guilty to one count of obstructing an investigation into health-care offenses, admitting he asked people to lie for him or omit information, knowing they were going to be questioned by investigators or a federal grand jury.

He also admitted to creating an "atmosphere of fear and intimidation" within his department to hinder prosecutors during their 2-½-year investigation.

Prosecutors agreed to recommend at his Oct. 18 sentencing that he spend no time in prison but that, in addition to the $500,000 payment, he be required to perform 1,000 hours of community service and write an article for a medical journal on the importance of following billing rules.

As part of the plea deal, prosecutors said improper billings submitted by Winn were not intended to be fraudulent but resulted from "mistake and confusion" about rules subject to different interpretations. They agreed to recommend to state officials that he keep his medical license, citing his medical skills and the lack of any malpractice in the case.

The terms of the plea deal are subject to the approval of U.S. District Judge Robert Lasnik during sentencing. Most plea deals are accepted.

Winn's departure from UW allows the medical school to immediately begin recruiting a new chair to head the neurosurgery department, said Blanchard, the UW spokesman.

Winn served as chairman of the department until February, when he was forced to temporarily step down after UW cited serious allegations that had been raised in the billing investigation.

Without the separation agreement, Blanchard said, Winn wouldn't have waived his rights under the faculty code to a full review by other faculty members of UW's attempt to remove him.

Winn's plea and departure won't end the federal scrutiny, however.

Two other doctors remain under investigation, and UW Physicians, along with another entity that handles billings for UW doctors at Children's Hospital & Regional Medical Center, also face a large civil fine.

Steve Miletich: 206-464-3302 or smiletich@seattletimes.com