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Sacred Heart Hospital owner out on bond

Sacred Heart Hospital | Sun-Times files

Sacred Heart Hospital | Sun-Times files

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Updated: May 21, 2013 6:28AM



A wealthy hospital owner accused of cashing in by illegally preying on poor and elderly patients demonstrated his financial might Friday when he walked out of federal lockup after posting $4 million in cash.

Edward Novak, 58, will also be required to post a further $6 million bond next week to stay free.

It shouldn’t be a problem.

The owner of the West Side’s Sacred Heart Hospital is worth a cool $25 million, prosecutors say.

But Novak allegedly made part of that fortune overseeing a ghoulish Medicare and Medicaid scam in which he bribed doctors to hospitalize, drug and operate on vulnerable patients unnecessarily.

Locked up since a raid on his for-profit hospital Tuesday, he was freed Friday night after a hearing in federal court.

Prosecutor Joel Hammerman had warned Magistrate Judge Daniel Martin that Novak’s wealth and his attempts to cover up his alleged schemes made him a flight risk. Novak “purchased patients” and “treated them as commodities,” then tried to conceal his assets from the court, Hammerman said as Novak furiously shook his head in denial.

But defense attorney Robert Gevirtz countered that he was “bewildered” by prosecutors’ attempts to keep Novak locked up.

“They’re making a federal case out of a federal case,” he joked, adding that defendants in similar kickback cases are typically released without posting cash. Gevirtz also accused the U.S. Attorney’s office of playing to the media in the high-profile case.

Martin disagreed that the case was typical, but eventually released Novak after he agreed to post a total of $10 million, to surrender his passport and to wear an electronic tracking bracelet until next week.

The hospital owner’s freedom before the weekend was only finally secured when his wife dramatically ran into the courtroom clutching a $4 million check with just moments to spare.

Friday’s hearing also revealed that Novak wasn’t the only rich guy accused in the alleged scam.

Dr. Venkateswara Kuchipudi, who allegedly took kickbacks from Novak to refer cases to Sacred Heart, had $4 million in assets frozen as a condition of his release.

And the hospital’s finance chief Roy Payawal had to post $2 million in assets to get out.

Four other doctors accused in the case have been released without posting bonds.

The Sun-Times revealed earlier this week that one of the five patients who died at Sacred Heart after undergoing potentially questionable surgeries was 48-year-old South Sider Naaman Durham, whose family say they may now s



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