My wife is a Hospice nurse she saleried and does not receive overtime pay. Recently she has a personal surgery and the first few weeks back at work she was working 4 hour days per doctors written orders.

The employer is paying her for 20 hours and not 40. Is this right? Can she work more than 40 and not be compensated for overtime but when she can't work upto 40 they can cut her pay?

From what you say there is a strong likelihood that she qualified for FMLA, and FMLA is unpaid leave. IF FMLA is involved, then yes, it is legal for them only to pay her for the time she works under these circumstances.

Note that FMLA is the ONLY time that she can have her salary docked in partial day increments.