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Recent Criminal and Civil Enforcement Actions
From Akerman’s Health Law Rx Blog:
POSTED BY JOSEPH W. N. RUGG ON FEBRUARY 15, 2013
In 2009, the Health Care Fraud Prevention and Enforcement Action Team (“HEAT”) initiative was formed as a joint effort between the Departments of Justice and Health and Human Services, and combating health care fraud continues to be a major focus of federal and state authorities. The Office of Inspector General (“OIG”) publishes a list of the criminal and civil enforcement actions and the punishment that has been meted out to those convicted of some sort of healthcare fraud. Here are three examples from February listings where jail time or substantial fines or both have been imposed.
- On February 1, a 50-year-old pharmacist who owned and operated 26 pharmacies in the Detroit area was sentenced to 17 years in prison. The evidence presented at trial showed that during 2006 through 2011 the pharmacies had billed Medicare and Medicaid more than $57 million, at least 25% of which billings were fraudulent as being either medically unnecessary or never actually dispensed. Similar fraudulent activities occurred with respect to commercial insurance. The pharmacist’s business model was to pay kickbacks to physicians in exchange for writing prescriptions for expensive medications or for controlled substances without regard to medical necessity. In addition to the jail time, the defendant was required to repay Medicare and Medicaid $17.3 million and commercial insurers $1.5 million.
- On February 4, two patient recruiters for a Miami home healthcare company pleaded guilty for their participation in a $20 million home health Medicare fraud scheme. The recruiters admitted that during 2007 through 2009, they recruited patients for which the home health agency could bill Medicare, and the home health agency’s owners paid them kickbacks and bribes. Medicare was billed for home health care and therapy services that were either medically unnecessary or not provided. The recruiters face jail time and fines, and each of the two home health agency’s owners have already been sentenced to over 6 years in jail.
- On February 7, St. Joseph’s Medical Center, a hospital located in Towson, MD, agreed to pay $4.9 million in connection with its submission of false claims to Medicare, Medicaid, and other federal healthcare programs. The hospital stated that during 2007 through 2009 it admitted patients for short stays – typically one or two days – that were not warranted by the patient’s medical condition but which would result in larger insurance payments than was appropriate.
If you are aware of potentially fraudulent or even inadvertent noncompliant activities in your healthcare business, you need to seek assistance to fix those problems before they become the object of an investigation. Because former employees and business partners of healthcare providers are often the ones reporting the fraudulent activities to the authorities, problems cannot be ignored.
Since the the above blog was posted on the Akerman Health Law Rx Blog, the following was posted by the OIG:
Cardiologist admits taking cash kickbacks for patient referrals — According to a February 14, 2013 press release from the Office of the U.S. Attorney, District of New Jersey:
Shashi Agarwal, 60, of Edison, N.J., who has his own cardiology practice in East Orange, N.J., pleaded guilty before U.S. District Judge Claire C. Cecchi in Newark federal court to an Information charging him with one count of soliciting and receiving more than $100,000 in cash kickbacks in violation of the federal health care anti-kickback statute.
Agarwal is the 10th person to plead guilty in the government’s investigation into the scheme to pay cash to health care providers who referred patients to Orange Community MRI, LLC (Orange MRI) in Orange N.J., for diagnostic testing.
11th Circuit Upholds Florida’s Patient Self-Referral Act
From Akerman’s Health Law Rx Blog:
POSTED BY JOSEPH W. N. RUGG ON FEBRUARY 4, 2013
Last month, in the case Fresenius Medical Care Holdings, Inc. et al. vs. DVA Renal Healthcare, Inc., the 11th Circuit Court of Appeals upheld the constitutionality of the Florida Patient Self-Referral Act of 1992.
The Florida Legislature modeled the Florida Act after the federal Physician Self-Referral Prohibitions, or Stark law, that was passed in 1989. The Stark law has gone through a number of revisions and clarifications over the last 23 years, but the Florida Legislature has not kept the Florida Act up to date with the many changes in the Stark law. The result is that the Florida Act contains provisions that are either inconsistent with, or in some instances more burdensome than, the Stark law. This makes it difficult for healthcare businesses to operate in Florida, as Fresenius discovered.
Fresenius and the related appellants are out-of-state corporations that provide renal dialysis services in Florida, both directly and through subsidiary corporations, to patients suffering from end stage renal disease. Fresenius wanted to use a vertically integrated business model in Florida and refer all the patients’ blood work to associated laboratories. Fresenius stated that such a business model would be more efficient and better for patients. However, because the employee-physicians of Fresenius had a financial interest in the associated laboratories, they were prohibited by the Florida Act from referring their patients there for blood work.
Fresenius sued the Secretary of the Florida Department of Health and the members of the Florida Boards of Medicine and Osteopathic Medicine, arguing that the Florida Act is unconstitutional because it is (1) preempted by federal law, (2) violative of the dormant U.S. Constitution’s Commerce Clause, and (3) violative of substantive due process.
The Court of Appeals was not persuaded by any of the legal arguments made by Fresenius and upheld the constitutionality of the Florida Act.
The important take away from this case is that in Florida, as in many states, there are legal restrictions on a physician’s ability to refer patients to entities in which the physician may have an investment interest. Compliance with the Stark law is not enough. The Florida Act is much more restrictive. Moreover, Florida has its own versions of the anti-kickback and the false claims statutes. When physicians do business transactions in Florida, it is critical that all of the relevant statutes are carefully considered.
Akerman’s Health Law Rx Blog
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Content on Akerman’s Health Law Rx Blog is intended to inform you about legal developments, including recent decisions of various courts and administrative bodies. It should not be construed as legal advice or a legal opinion, and you should not act upon the information without seeking the advice of legal counsel.
With more than 550 lawyers and government affairs professionals and a network of 19 offices, Akerman is ranked among the top 100 law firms in the U.S. by The National Law Journal NLJ 250 (2012). The firm’s Healthcare Practice Group includes over twenty attorneys and professionals representing health systems, physicians, health insurers, and other clients in all aspects of healthcare law across Florida and throughout the United States.
Beth Kassab: Patients lose when hospitals take over doctors
When a big hospital chain buys an independent doctor’s office, we often hear the move will “enhance care”, “integrate care” or “improve health-care efficiency.”
Spare us the euphemisms.
Patients are the losers in these deals.
We pay higher costs. We get fewer choices because doctors are pressured to refer patients only to providers who also work for the hospital. And, because these acquisitions are so common today, an independent doctor’s office is becoming as quaint as the house call.
Unfortunately, this is the entire article and is much too short to discuss a topic full of so many nuances. Tough issues need far more analysis and thought than this. The question to study is, if the goal of physician practice acquisitions is integration of healthcare to enhance and improve the patient experience while reducing costs, then where are the disconnects? Why are hospitals and physicians failing (assuming this “reporter” is correct in her bottom line conclusion)?
See on articles.orlandosentinel.com
USDOJ: Owner and Operator of Florida Halfway House Company Sentenced to 51 Months in Prison for Role in Medicare Fraud Scheme
The owner and operator of New Way Recovery Inc., a Florida corporation that operated several halfway houses, was sentenced today to serve 51 months in prison for his role in a $205 million Medicare fraud scheme involving fraudulent claims for purported partial hospitalization program (PHP) services, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida; Michael B. Steinbach, Acting Special Agent-in-Charge of the FBI’s Miami Field Office; and Special Agent-in-Charge Christopher B. Dennis of the HHS Office of Inspector General (HHS-OIG), Office of Investigations Miami Office.
Hassan Collins, 41, was sentenced by U.S. District Judge Kevin Michael Moore in the Southern District of Florida. In addition to his prison term, Collins was sentenced to serve three years of supervised release and ordered to pay $2,413,675 in restitution, jointly and severally with co-conspirators.
On June 14, 2012, Collins pleaded guilty to one count of conspiracy to receive and pay health care fraud kickbacks.
According to court documents, from approximately April 2004 through approximately September 2010, Collins, along with co-conspirators, received kickback payments in exchange for referring Medicare beneficiaries, who did not qualify for PHP treatment, for purported PHP services to American Therapeutic Corporation (ATC), a Florida corporation that operated several purported PHPs throughout Florida. Collins and his co-conspirators caused false and fraudulent claims to be submitted to Medicare for PHP services purportedly provided to Medicare beneficiaries at ATC’s locations, when, in fact, the services were never provided.
See on www.justice.gov
For an aggregation of other articles on Hot Topics in Healthcare Law, go to my magazine on Scoop.it – Hot Topics in Healthcare Law and Regulation and my newspaper on Paper.li – Hot Topics in Healthcare Law.
For an aggregation of other articles on improving healthcare, go to my internet magazine Scoop.it! Changing Health for the Better.
Physician Associates to be bought by Orlando Health – Orlando Business Journal
According to the Orlando Business Journal: Physician Associates LLC has agreed to negotiate exclusively to be acquired by Orlando Health.
The details of the arrangement, including dollar value, have not been disclosed, but analysts spoken to for a story in August speculated the deal could be valued anywhere from $20 million to $60 million.
“Physician Associates LLC and Orlando Health today announced the physician practice has selected Orlando Health as the organization with which it will begin exclusive acquisition negotiations,” said Kena Lewis, Orlando Health spokeswoman.
Florida Hospital also was vying to buy the practice.
See on www.bizjournals.com
For an aggregation of other articles on Hot Topics in Healthcare Law, go to my magazine on Scoop.it – Hot Topics in Healthcare Law and Regulation and my newspaper on Paper.li – Hot Topics in Healthcare Law.
For an aggregation of other articles on improving healthcare, go to my internet magazine Scoop.it! Changing Health for the Better.
USDOJ: Medicare Fraud Strike Force Charges 91 Individuals for Approximately $430 Million in False Billing
Medicare Fraud Strike Force operations in seven cities have led to charges against 91 individuals – including doctors, nurses and other licensed medical professionals – for their alleged participation in Medicare fraud schemes involving approximately $429.2 million in false billing, Attorney General Eric Holder and Health and Human Services (HHS) Secretary Kathleen Sebelius announced today.
Attorney General Holder and Secretary Sebelius were joined in the announcement of the nationwide takedown by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division, FBI Associate Deputy Director Kevin Perkins, Inspector General Daniel R. Levinson of the HHS Office of Inspector General (HHS-OIG) and Dr. Peter Budetti, Deputy Administrator for Program Integrity of the Centers for Medicare and Medicaid Services (CMS).
“Today’s enforcement actions reveal an alarming and unacceptable trend of individuals attempting to exploit federal health care programs to steal billions in taxpayer dollars for personal gain,” said Attorney General Holder. “Such activities not only siphon precious taxpayer resources, drive up health care costs, and jeopardize the strength of the Medicare program – they also disproportionately victimize the most vulnerable members of society, including elderly, disabled and impoverished Americans.”
“Today’s arrests put criminals on notice that we are cracking down hard on people who want to steal from Medicare,” said HHS Secretary Sebelius. “The health care law gives us new tools to better fight fraud and make Medicare stronger. In addition to the arrests made today, HHS used new authority from the health care law to stop future payments to many of the health care providers suspected of fraud, saving Medicare resources and taxpayer dollars from being lost to fraud in the first place.”
See on www.justice.gov
For an aggregation of other articles on Hot Topics in Healthcare Law, go to my magazine on Scoop.it – Hot Topics in Healthcare Law and Regulation and my newspaper on Paper.li – Hot Topics in Healthcare Law.
For an aggregation of other articles on improving healthcare, go to my internet magazine Scoop.it! Changing Health for the Better.
Medical Holocaust Blogpost: Florida, HCA, Rick Scott and Medicare Fraud
Some strong opinions and YouTube videos from the Medical Holocaust Blogpost:
“Rick Scott is just one of many corporate gangsters operating in the lucrative and largely unregulated medical industry. Now street level thugs in Florida have taken a lesson form guys like Rick Scott and are bilking Medicare for billions. Rick Scott wins the gold medal when it comes to bilking Medicare and private insurance out of billions and his gold medal performance has inspired other criminals of a slightly different pedigree to follow in his footsteps.”
See on medicalholocaust.blogspot.fr
For an aggregation of other articles on Hot Topics in Healthcare Law, go to my magazine on Scoop.it – Hot Topics in Healthcare Law and Regulation and my newspaper on Paper.li – Hot Topics in Healthcare Law.
For an aggregation of other articles on improving healthcare, go to my internet magazine Scoop.it! Changing Health for the Better.
Joseph Rugg's Health Law Blog 