Kusserow’s Corner: Highlights of April Medicare Enforcement

In St. Louis, the owner of a home health care agency with no medical or health care education, pleaded guilty to submitting fraudulently hundreds of billing work sheets and claim forms that patients had received therapy services when they had not. Prior to opening the home care business, she worked as cosmetologist.

A Detroit jury convicted a physical therapist, physical therapy assistant, and unlicensed doctor for their participation in a nearly $15 million Medicare fraud scheme over a three year period at several home health care companies. Three other individuals charged in the case remain fugitives. Beneficiaries pre-signed medical paperwork that was provided to defendants and other physical therapist assistants to fill in with false information purporting to show that the care was provided, when it was not.

In Newark, a regional medical center paid $435,640 in a civil settlement for making improper inflated rental payments above fair market value to a cardiology group that referred large numbers of patients to the hospital. The subsequent billings of Medicare for services resulting from those tainted referrals were viewed as false claims in violation of federal anti-kickback and self-referral laws. This was brought by a qui tam whistleblower who will share in a portion of the proceeds recovered.

In Kansas City, Mo., a licensed chiropractor and owner of a clinic pleaded guilty to submitting $3 million for fraudulent claims to Medicare for nerve-block injections that were not medically indicated and necessary for the Medicare coverage guidelines. The treatment was not supported by medical research studies or peer-reviewed medical publications.

In Houston, two vice presidents in Continuum Healthcare LLC were indicted for conspiracy to pay kickbacks to several area personal care home owners and patient advocates. They ran Continuum, which owned and operated three community mental health centers that billed Medicare and Medicaid for mental health services alleged to be unnecessary, and, in some cases, not even provided, as well as directed kickbacks to be paid to numerous area personal care home owners and patient advocates in exchange for the referral of Medicare patients. Eight others were also charged with conspiring to solicit or receive kickbacks in connection with a federal benefit program. The scheme resulted $173 million fraudulent bill being submitted to Medicare and Medicaid.

A Louisiana pharmacy owner pleaded guilty to directing a $2.2 million Medicare fraud scheme by paying client employees, including nursing homes and mental health facilities, to collect and return unused prescription drugs that were resold.

In Newark, N.J., a radiologist who owned and operated a diagnostic testing center was sentenced to 46 months in prison and ordered to forfeit more than $2 million for a cash-for-patients scheme to bribe doctors for testing referrals. The facility provided diagnostic testing services, such as MRIs, CAT Scans, ultrasounds, echocardiograms and dual-emission X-ray absorptiometries, known as “DEXA Scans” and made $2 million in corrupt revenues from Medicare and Medicaid for tests performed on patients referred by doctors who received kickbacks for those referrals.

In Houston, the owner of two DME companies sentenced to prison for 11 years and ordered to pay $744,105 in restitution to Medicare and Medicaid, and $106,492.10 to the Social Security Administration, following a jury trial convictions. A co-defendant pleaded guilty earlier this year. The scheme involved submitting claims to Medicare and Medicaid for DME and incontinence supplies that were not delivered, wanted or needed by beneficiaries and were often the result of illegal kickbacks. Approximately $3,391,771.90 in claims to Medicare and Medicaid were submitted.

A Dearborn, Michigan, doctor was convicted by a jury as guilty on all 34 counts in the indictment for illegal drug distribution, health care fraud, and money laundering involving more than 3.7 million dosage units of controlled substances, such as Oxycodone and Vicodin, outside the course of legitimate medical practice, which were resold on the street market or used by addicted patients. He transferred more than $1.5 million in proceeds from his crimes to an overseas bank account.

In Wheeling, West Virginia, a doctor and physician practice will pay a $1 million penalty after violating federal law by submitting false claims to Medicare, as the result of improper compensation arrangements the physician and hospital.

In Oklahoma City, the owner, manager, and hospice company were indicted of Medicare fraud. The defendants conspired and falsify documents to conceal the true medical condition of the hospice patients and the true quality and quantity of health care services they were receiving in order to “pass” a Medicare audit and to fraudulently obtain money from Medicare. The indictment also charges the defendants with conspiracy, obstruction of a federal audit, and making false statements in health care matter.

In Albuquerque, NM, a federal grand jury has returned a 111-count indictment charging a physician, who operated a pain management clinic, with the unlawful dispensing of opioid pain medication, primarily Oxycodone and methadone, to Medicare and Medicaid patients outside the usual course of medical practice and without a legitimate medical purpose.

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 © 2014 Strategic Management Services, LLC. Published with permission.