Federal prosecutors said this week they have reached a tentative deferred prosecution agreement with Chesapeake Regional Medical Center for charges related to disgraced former OB-GYN Javaid Perwaiz.
The deal would require the hospital to admit certain facts, accept an independent monitor, repay health care programs and create a $12.8 million fund for Perwaiz’s former patients. If finalized, the deal would let the hospital avoid a criminal trial.
Legal experts previously told WHRO a federal conviction could cut Chesapeake Regional off from Medicare, Medicaid and other federal health care payments — a punishment that they said could put a hospital out of business.
Perwaiz was convicted in 2020 of health care fraud and false statements after prosecutors said he performed unnecessary surgeries and sterilizations.
Between 2010 and 2019, the hospital received $18.5 million from public and private benefit providers for procedures Perwaiz performed, including some prosecutors allege he misclassified.
Federal prosecutors have then charged Chesapeake Regional with conspiracy to defraud the United States and health care fraud, alleging officials at the hospital were aware of Perwaiz’s conduct and did nothing to stop him.
Court filings describe the civil litigation as involving more than 1,040 plaintiffs and care Perwaiz provided between 1984 and 2019, and the former patients allege Chesapeake Regional was negligent in hiring, retaining and granting privileges to Perwaiz.
The hospital pleaded not guilty to the charges in January 2025. This week, Chesapeake Regional confirmed to WHRO that a deal has been reached, but said it cannot comment further because the agreement is not finalized.
The U.S. Attorney’s Office said the proposed $12.8 million patient fund would be available to people whose medical records show they had procedures performed by Perwaiz at Chesapeake Regional.
But the fund would only cover losses allowed under the Mandatory Victims Restitution Act, such as the cost of medical procedures or therapy. It would not cover emotional distress or similar damages.
A class-action lawsuit against the hospital including more than 1,000 former patients is still ongoing.
A court order entered this week has shown multiple civil cases have been consolidated into one and several plaintiffs have dropped claims against the hospital and three former executives: James Reese Jackson, Peter Francis Bastone and Wynn Lawton Dixon Jr.
Claims remain pending against two former Chesapeake Regional CEOs: Donald S. Buckley, who quietly left the post in May, and Christopher Mosley, who the Virginian-Pilot reported in 2010 “resigned abruptly” after 5 years leading the hospital.
Chesapeake Regional has argued that the civil claims are barred by Virginia’s statute of limitations because the procedures happened years ago.
Plaintiffs said the legal deadline should not block their claims because of the hospital’s alleged conduct and the related criminal case.
A spokesperson for Victoria Wickman, who is representing the plaintiffs, told WHRO the former patients will next seek evidence from the defendants and ask the court for permission to update their complaint.
