Kusserow’s Corner: Enforcement Action Update for the Week Leading Up to Thanksgiving

In the days leading up to Thanksgiving, the justice system was hard at work. The following are some key enforcement actions that took place:

Ft. Myers, Fla.

Joshua S. Putter of Needham, Massachusetts was indicted for destruction, alteration, or falsification of records in federal investigations. According to the indictment, on or about October 7, 2008, Putter knowingly falsified, or made false entry in a document, with the intent to impede, obstruct, or influence any matter within the jurisdiction of any department of agency of the United States.

Baton Rouge, La.

Sabine Optical Laboratories, Inc. d/b/a the Vision Center, Dr. Carl Carnaggio, Sr., Dr. Carl Carnaggio, Jr, Lori Carnaggio, and Cypress Optical Laboratory, LLC, a Sabine-affiliated company, settled with the Department of Justice (DOJ) in the amount of $1,200,000 to resolve a health care “whistle blower” (“qui tam”) law suit filed by a former employee. Defendants admitted to improperly billing Medicaid for services performed by an unauthorized provider using the Medicaid provider number of another provider, for adjustment and dispensing services that were never performed, for worthless services due to an excessive number of Medicaid patients being seen in one day, and for lenses that were never made.

Charlotte, N.C.

Calvin Cantrell Estrich was found guilty by a jury of committing health care fraud, making false statements in connection with a health care program, stealing the identities of children and clinicians to commit the fraud, money laundering, and making false statements to investigators in the amount of at least $700,000 from the Medicaid program. Estrich’s company, Everyday’s Blessing, was approved by Medicaid to provide Intensive In-Home Community Intervention Services, which are mental and behavioral services designed to stabilize living arrangements for youth and children and prevent out-of-home therapeutic treatment. Estrich and his co-conspirator, Joye Strong, participated in a scheme to defraud Medicaid for medically unnecessary services. In many instances, the Medicaid recipients did not receive any services at all.

Houston, Tex.

Emeka Daniel Orgi was sentenced to 48 months in prison and ordered to pay $1.5 million in restitution to the Medicare program following his conviction for conspiracy to commit and committing health care fraud. He opened Spectrum Foundation Inc., a durable medical equipment company, and worked with a co-conspirator, Aghaegbuna “Ike” Odelugo, to submit approximately $4.4 million in false claims to Medicare. Most items billed to Medicare and Medicaid, including “Artho kits” and power wheelchairs, were either were not delivered at all, not medically necessary, not prescribed by a physician, or upcoded from what was actually delivered. They obtained Medicare beneficiary information by paying recruiters, then created paperwork and patient files to give the appearance of a valid claim. Odelugo pleaded guilty and was sentenced last year to 72 months in prison.

Nashville, Tenn.

Dr. Edward “Eddie” Hamilton, the former owner of the medical practice of Centennial Pediatrics, P.C., pleaded guilty to one count of health care fraud. Pursuant to the criminal plea and civil settlement, Hamilton is excluded from participation in all federal health care programs for 20 years and is ordered to pay criminal restitution and False Claims Act damages totaling over $1.6 million. Hamilton and his co-conspirator, Joye Strong, participated in a scheme to defraud Medicaid for billing for infant hearing exams performed at Baptist Hospital as comprehensive auditory exams, even though they only performed the less expensive auditory screens. Hamilton also admitted to systemically billing for urinalysis testing as though his office had performed a microscopic examination of the sample despite the fact that no microscopy had been performed. Centennial also upcoded its billings in this manner even though its clinics did not own or possess the microscopes necessary to conduct such examinations.

Jackson, Tenn.

Rebecca Christain, owner of Sleep Analysts, Inc. and a subsidiary company, Pulmonary Solutions, pleaded guilty to Medicare health care fraud and money laundering. Christain provided respiratory therapy services and devised a fraudulent scheme of hiring unlicensed individuals to perform services that were billed to Medicare as respiratory therapy services. She also instructed her staff to falsify the amount of time during which services were provided. She designated certain services for billing under physical therapy codes and instructed staff to double or triple bill for certain services using both physical therapy and respiratory therapy codes. In total, Christain caused fraudulent claims in excess of $1,000,000 to be paid by Medicare and Medicaid for fraudulently billed respiratory therapy services.

Chicago, Ill.

Vantage Oncology LLC (Vantage) settled with the DOJ for more than $2.08 million to settle allegations that it submitted false claims to Medicare for radiation oncology services performed. Vantage, which owns and manages radiation oncology centers in multiple states, double billed and overbilled Medicare for certain procedures, billed for services that lacked supporting documentation, and improperly billed for radiation treatment provided to patients without proper physician supervision. This settlement resolves a lawsuit filed by a former Vantage employee under the qui tam, or whistleblower, provisions of the False Claims Act.

Newark, N.J.

New Jersey U.S. Attorney Paul J. Fishman announced that two doctors admitted to accepting bribes in exchange for test referrals as part of a long-running and elaborate scheme operated by Biodiagnostic Laboratory Services LLC (BLS), of Parsippany, N.J., its president, and numerous associates. Richard Goldberg and Gary Leeds each pleaded guilty to accepting bribes. So far, 11 employees or associates of BLS, and nine physicians have pleaded guilty to their roles in connection with the bribery scheme, which involved millions of dollars in bribes and resulted in more than $100 million in payments to BLS from Medicare and various private insurance companies. The investigation has recovered more than $6.5 million to date through forfeiture. As part of their guilty pleas, Goldberg and Leeds each agreed to forfeit $108,000.

Richard P. Kusserow served as DHHS Inspector General for 11 years. He currently is CEO of Strategic Management Services, LLC (SM), a firm that has assisted more than 3,000 organizations and entities with compliance related matters. The SM sister company, CRC, provides a wide range of compliance tools including sanction-screening.

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Copyright © 2013 Strategic Management Services, LLC. Published with permission.