Health Care Fraud & Abuse: The Week in Review

It's been a busy week-and-a-half on the health-fraud enforcement front. I like posting these DOJ/Office of Inspector General updates for a number of reasons. [1] The scope and variety of the fraud schemes is truly impressive, exceeded only by [2] the brazenness of the fraudsters and [3] the success rate of the state and federal enforcement offices.

THE WEEK IN REVIEW

• United States Files False Claims Act Complaint Against Erlanger Health System -- July 26, 2024: This qui tam action is for alleged violations of the Stark Law in the form of "compensation Erlanger paid to [employee] physicians [that] was well above fair market value." 
  
  
• Precision Lens Agrees To Pay $12 Million To The United States For Kickbacks To Doctors In Violation Of The False Claims Act -- July 25, 2024: From the announcement -- 

"Precision Lens provided kickbacks to [ophthalmic surgeons] in the form of travel and entertainment, including high-end ski trips, fishing, golfing, hunting, sporting, and entertainment vacations, often at exclusive destinations. For many of the trips, physicians were transported to luxury vacation destinations on private jets, including trips to New York City to see a Broadway musical, the College Football National Championship Game in Miami, Florida, and the Masters Tournament in Augusta, Georgia. Precision Lens sold frequent flyer miles to its physician customers at a significant discount, enabling the physicians to take personal and business trips at well below fair market value.

 

"The jury found that Precision Lens’s conduct resulted in $43,694,641.71 in fraudulent claims submitted to Medicare. By operation of the statute, the court entered a $487,048,705.13 judgment against the company and its owner, which included treble damages and civil penalties under the False Claims Act. Following post-trial motions, the court reduced the judgment to $216,675,248.55. After the United States conducted a review of the defendants’ financial position and ability to satisfy the judgment, the parties entered into a settlement agreement which requires Precision Lens and the estate [of the deceased owner of Precision Lens] to immediately pay $12 million to resolve the United States’s claims." [emphasis added]

• Substance Use Disorder Treatment Clinics To Pay More Than $850,000 To Resolve Allegations They Knowingly Overbilled Medicaid For Office Visits -- July 25, 2024: This is a standard-issue "upcoding" case. From the announcement -- The U.S. and Virginia "contended that, from 2016 through mid-2023, the clinics submitted claims to Virginia Medicaid containing code 99215, which signifies a meeting with a patient involving at least two of the following three components: a comprehensive medical history, a comprehensive medical examination, and medical decision making of high complexity. However, the clinics knew the meetings were regular check-ins during substance use disorder treatment and did not meet those criteria."
  
  
• United States Obtains $26M In False Claims Act Judgments Against Laboratory Companies And Their Owner -- July 25, 2024: This is a default judgment (i.e., for failure to defend the government's allegations), which (based upon memory alone) seem pretty rare. The allegations were that the defendants 

"sought to profit from the unfolding COVID-19 pandemic by offering COVID-19 tests to nursing homes as a way to bill Medicare for a wide array of medically unnecessary respiratory pathogen panel (RPP) tests. The complaint alleged that these RPP tests were not medically necessary because the beneficiaries had no symptoms of a respiratory illness and because the tests were for uncommon respiratory pathogens.

 

"The complaint also alleged that Britton-Harr and Provista Health submitted claims for RPP tests that were never ordered by physicians and sometimes for RPP tests that were never performed, including over 300 claims that stated that the nasal swab test sample was supposedly collected from the beneficiary on a date after the beneficiary had died."

COVID-19 fraud and elder fraud. Despicable. 

• Santa Paula Doctor Pleads Guilty To Health Care Fraud For Role In Hospice Scam That Bilked Medicare Out Of $3.2 Million -- July 24, 2024: False certification of terminal condition --> submission of fraudulent claims of hospice eligibility.
  
  
• Riverside County Chiropractor Agrees to Pay $180,000 to Resolve Allegations of Health Care Fraud -- July 24, 2024: Another upcoding case? Medicare was billed for surgically implanted neurostimulators when the defendant actually "taped a disposable 'electroacupuncture' device called 'Stivax' to their patients’ ears. Stivax devices do not require surgical implantation and are not reimbursable by Medicare."
  
  
• Mental Health Services Providers Pay Over A Million To Settle False Claims Liability -- July 24, 2024: Defendants billed various government health care programs for physician services that were actually performed by nonphysicians who were not directly supervised by a physician. 'Some services occurred on dates when the physicians were traveling outside of the United States and thus unable to provide the services. Others allegedly occurred at times when it was not logistically possible for the physicians to have rendered them or directly supervised the services themselves due to the sheer volume of patients at multiple office locations located in and around the Houston area."
  
  
• Admera Health Agrees To Pay Over $5M To Settle False Claims Act Allegations Of Kickbacks To Third Party Marketers -- July 24, 2024: Classic.
  

• Doctor Convicted For Illegally Distributing Over 1.8M Doses Of Opioids And $5M Health Care Fraud Scheme -- July 23, 2024: Physician convicted of "conspiring to illegally distribute over 1.8 million doses of Schedule II controlled substances, including oxycodone and morphine, to drug-seeking individuals and drug abusers and for defrauding health care benefit programs of more than $5.4 million."
  
  
• Two Individuals Indicted For Stealing More Than $150,000 From MassHealth Program -- July 23, 2024: A Massachusetts Medicaid member is alleged to have falsely submitted timesheets  attesting to personal-care assistant (PCA) services that were never rendered. because the PCA was incarcerated during the time periods in question. 
  
  
• Topeka Man Charged With Embezzlement -- July 22, 2024:  Program manager and director of the Prairie Band Potawatomi Nation’s Diabetes Prevention Program is accused of embezzling $5,000 or more in federal grant money. 
  
  
• Owner Of Home Health Care Company Convicted Of Multimillion Dollar Heath Care Fraud Scheme -- July 22, 2024: For years, defendant's company billed the Massachusetts Medicaid program for home health services it did not provide, were not authorized, or were not medically necessary. The company also paid kickbacks and laundered illegal proceeds. The fraudulent billings amount to "at least" $100 million. The owner of the company used the proceeds "to treat herself to million-dollar cash bonuses, a lavish house, and a Maserati." Crime pays . . . until it doesn't.
  
  
• Attorney General Bonta Secures Sentencing of Southern California Dentist for Medi-Cal Fraud -- July 22, 2024: Defendant owned dental practice where she served as a dentist and carried out the fraudulent billing scheme. Under defendant's contract with a Federally Qualified Health Center that participates in Medi-Cal, she received reimbursement for each day of service billed rather than for the individual services provided to the patient. However, her dental practice fraudulently split its services over multiple days on its claims for reimbursement in order to maximize reimbursement from Medi-Cal.