Former ALJ pleads guilty for role in $550 million scam

A former administrative law judge (ALJ) for the Social Security Administration (SSA) pleaded guilty in federal district court in Kentucky on May 12, 2017, for his part in a scheme that defrauded the SSA of over $550 million in federal disability payments for thousands of claimants.

For more than 20 years, the ALJ adjudicated disability claims on behalf of the SSA. As part of his guilty plea, he admitted to accepting over $609,000 in cash payments over some seven years in more than 3,100 cases from a Kentucky Social Security disability lawyer. The former ALJ admittedly divided the cash deposits among various accounts in an attempt to conceal the source of the cash.

In exchange for the illegal gratuities, the ALJ advised the lawyer as to the type of medical evidence to submit for his clients and he awarded disability benefits to thousands of claimants represented by the lawyer without holding hearings. As a result, the lawyer received at least $7.1 million in representative fees from the SSA, and by his misconduct, the ALJ obligated the SSA to pay more than $550 million in lifetime benefits to claimants.

The ALJ was indicted on April 1, 2016, along with the lawyer and a clinical psychologist. They were charged with conspiracy, fraud, false statements, money laundering and other related offenses in connection with the scheme. The lawyer pleaded guilty to the fraud scheme earlier this year; the clinical psychologist is currently awaiting trial; and the ALJ’s sentencing is set for Aug. 25, 2017.

No rapid crossover yet of ‘narrow provider networks’ from health exchanges to employer plans

So-called “narrow provider networks,” which limit covered health providers in health plans, do not appear to be crossing over rapidly from the Patient Protection and Affordable Care Act’s (ACA) (P.L. 111-148) health exchanges into employment-based health plans, according to a new analysis by the nonpartisan Employee Benefit Research Institute (EBRI) and Mark A. Hall, J.D., Wake Forest University, with support from the Robert Wood Johnson Foundation’s (RWJF) Changes in Health Care Financing & Organization (HCFO) Initiative.

“Narrow networks,” which have grown in the individual market exchanges under the ACA, are characterized by offering considerably fewer health providers than is typical in the group market and in which providers are included primarily based on price discounting.

“Narrow networks are receiving renewed attention, because of their increasing prominence in the ACA’s individual marketplace health exchanges,” said Paul Fronstin, director of EBRI’s Health Education and Research Program, and co-author of the report.

“So far, this has not translated strongly to private-sector employers. But there are signs that employers’ interest in narrow networks may grow in the near future.”

To measure what is happening with narrow networks in employer health plans, the researchers conducted a literature review, interviews with HR directors at 11 large employers, and field research by health policy experts in 11 states. Among the major findings:

  • Despite the increasing prominence of narrow networks in the ACA individual (nongroup) marketplace exchanges, this renewed interest so far has not translated strongly to employers. For example, in 2016, only 7 percent of employers with health plans offered a narrow network. Also, in 2014, employers ranked narrow networks the least effective among several strategies to manage health insurance costs.
  • Reasons employers give for their subdued interest include absence of track record showing sustained (year-over-year) savings; concern about antagonizing workers; spotty availability of narrow networks, especially in rural areas; greater interest currently in other cost-savings strategies; and reluctance to adopt substantial changes in benefit structures until the future of the ACA’s so-called “Cadillac tax” is resolved.
  • There are signs that employers’ interest in narrow networks may grow in the near future.
  • More than a third of employers with 5,000 or more workers now offer some type of alternative network, including tiered or “high-performance” networks. Field reports indicate increasing adoption of narrow networks by both large and small employers particularly in urban markets around the country.
  • Where narrow networks are offered, their adoption could be increased by giving workers stronger financial incentives to consider them. Offering workers a fixed (“defined”) contribution that does not vary by choice of plan is one way to confer such incentives, and private exchanges are a way to offer workers a broader range of choice. Currently, however, neither defined contributions nor private exchanges are widely used by employers.

ConAgra subsidiary hit with $8M criminal penalty for role in salmonella-tainted peanut butter poisonings

ConAgra Grocery Products LLC, a subsidiary of ConAgra Foods Inc., pleaded guilty to a criminal misdemeanor charge that it had shipped contaminated peanut butter linked to a 2006 through 2007 nationwide outbreak of salmonellosis, or salmonella poisoning, the Department of Justice announced. Following its guilty plea, the company was sentenced to pay an $8 million criminal fine and forfeit an additional $3.2 million in assets. The sentence represents the largest fine ever paid in a food safety case. ConAgra Grocery Products LLC is based in Omaha, Nebraska, with a manufacturing facility in Sylvester, Georgia.

The criminal information specifically alleged that on or about December 7, 2006, the company shipped from Georgia to Texas peanut butter that was adulterated in that it contained salmonella and had been prepared under conditions whereby it might have become contaminated with salmonella.

The company’s guilty plea was entered pursuant to a plea agreement filed last year in federal district court in the Middle District of (see ConAgra to pay $11.2M for its peanut butter and salmonella sandwich, May 20, 2015). In pleading guilty to violating the federal Food, Drug and Cosmetic Act (FDC Act), the company not only admitted that it had been aware of some risk of salmonella contamination in peanut butter, but it also admitted that (1) it had introduced Peter Pan and private label peanut butter contaminated with salmonella into interstate commerce during the salmonellosis outbreak; (2) samples obtained after a 2007 recall showed that peanut butter made at the Sylvester plant on nine different dates between August 2006, and January 2007, was contaminated with salmonella; (3) between October 2004 and February 2007, employees charged with analyzing finished product tests at the Sylvester plant failed to detect salmonella in the peanut butter; and (4) it was not aware some of the employees did not know how to properly interpret the results of the tests.

Following the outbreak and shutdown, the company made significant upgrades to the Sylvester plant to address conditions the company identified after the 2004 incident as potential factors that could contribute to salmonella contamination, according to the Department of Justice. The company also instituted new and enhanced safety protocols and procedures regarding manufacturing, testing and sanitation, which it affirmed in the plea agreement it would continue to follow.

Wolters Kluwer Recognized by Healthcare Tech Outlook as a 2016 Top 10 Most Promising Healthcare Compliance Solution Provider

Wolters Kluwer Legal & Regulatory U.S., a global leader in information services and solutions for legal professionals, has been recognized as one of the Most Promising Healthcare Compliance Solution Providers by Healthcare Tech Outlook. Click here to read the full Healthcare Tech Outlook profile of Wolters Kluwer.

“We are happy to announce Wolters Kluwer Legal & Regulatory U.S. as one of the 10 Most Promising Healthcare Compliance Solution Providers 2016,” said Alex D’Souza, Managing Editor of Healthcare Tech Outlook. Healthcare Tech Outlook took particular note of Wolters Kluwer’s Information and Security Assessment Manager (ISAM) application that supports effective management of privacy and information security risk. As healthcare regulations continue to evolve, the ISAM application enables organizations to assess, in real-time, whether their processes are in line with best practices.

“It is an honor to receive this industry recognition,” said Tim Feldman, VP and GM, Healthcare Compliance, Wolters Kluwer Legal & Regulatory U.S. “We take great pride in our ability to offer the seamless integration of workflow tools and expert regulatory and compliance content to deliver comprehensive solutions that help our customers move forward with confidence.”

Wolters Kluwer provides a range of solutions from information products such as Health Law Daily – a daily reporting service providing same-day coverage of breaking news, court decisions, legislation, and regulatory activity – to complete workflow solutions such as ComplyTrack, a comprehensive compliance platform that integrates a wide range of state-of-the-market applications that function synergistically at the enterprise level, supporting all aspects of healthcare compliance workflow.

About Wolters Kluwer

Wolters Kluwer Legal & Regulatory U.S. is a part of Wolters Kluwer N.V. (AEX: WKL) a global leader in information services and solutions for professionals in the health, tax and accounting, risk and compliance, finance and legal sectors. We help our customers make critical decisions every day by providing expert solutions that combine deep domain knowledge with specialized technology and services.

Wolters Kluwer reported 2015 annual revenues of €4.2 billion. The company, headquartered in Alphen aan den Rijn, the Netherlands, serves customers in over 180 countries, maintains operations in over 40 countries and employs 19,000 people worldwide.

Wolters Kluwer shares are listed on Euronext Amsterdam (WKL) and are included in the AEX and Euronext 100 indices. Wolters Kluwer has a sponsored Level 1 American Depositary Receipt program. The ADRs are traded on the over-the-counter market in the U.S. (WTKWY).

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About Healthcare Tech Outlook

Published from Fremont, California, Healthcare Tech Outlook is a print magazine, which features CIOs, ITVPs, CTOs, and other decision makers sharing their insights and perspective on healthcare industry. A panel of experts, technology leaders and board members of Healthcare Tech Outlook magazine has finalized the “10 Most Promising Healthcare Compliance Solution Providers 2016” and shortlisted the best vendors and consultants in the healthcare industry. For more info, visit: