Kusserow on Compliance: Four physicians charged in $200M prescription fraud scheme

A CEO and four physicians were charged in a superseding indictment in an investigation of a $200 million health care fraud scheme that involved a network of Michigan and Ohio pain clinics, laboratories, and other medical providers. Additional charges included wire fraud conspiracy, money laundering, and distribution of over 4.2 million medically unnecessary dosage units of controlled substances and medically unnecessary injections to Medicare beneficiaries, some of whom were addicted to narcotics. These included oxycodone, hydrocodone and oxymorphone. Some of the opioids were resold on the street.

When a medical review was made of the injection claims, it was found that 100 percent of the claims were not eligible for Medicare reimbursement. In order to conceal the continued billing of these fraudulent claims to Medicare, the defendants created new shell companies and continued to engage in the same billing of fraudulent claims, often changing only the name of the company on the door to the medical practice and/or inventing new suite numbers to conceal the continuation of the fraudulent practices at the same location. Defendants also owned a diagnostic laboratory to enable them to order medically unnecessary urine drug testing from the laboratory. When Medicare conducted a medical review of claims submitted by the laboratory, it determined that 95 percent of the claims were not eligible for Medicare reimbursement and ordered the diagnostic laboratory to repay $6.9 million in improper payments.

Another scheme involved money laundering in connection with a $6.6 million wire transfer and the withdrawal of $500,000 in cash, which was hidden in plastic bags in the closet of the house.  The indictment alleges that transferred proceeds derived from the conspiracy were used to allow the defendants to live an extravagant lifestyle and spend millions of dollars on luxury items—clothing from retailers like Hermes, rare Richard Mille watches, and exotic automobiles such as a Lamborghini and Rolls Royce Ghost. The proceeds were also used to purchase a mansion and other real estate in the Detroit, Michigan area and to sit courtside or in the first row of NBA basketball games, including the NBA Finals.

 

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 © 2018 Strategic Management Services, LLC. Published with permission.

Kusserow on Compliance: OIG Attorneys continue cross-designation with DOJ

The HHS OIG issued its Semi-Annual Report for the first half of fiscal year (FY) 2018 (October-March) and summarizes key accomplishments, significant problems, abuses, deficiencies, and investigative outcomes relating to the administration of HHS programs and operations that were disclosed during the reporting period. Included in the report is a section referred to as the “Special Assistant U.S. Attorney Program.” Many are unaware of this program that unites under the DOJ attorneys and Special Agents of the OIG that are cross-designated as Special Assistant U.S. Attorneys. These OIG attorneys are detailed full time to the Fraud section of DOJ’s Criminal Division for temporary assignments, including assignments to the Health Care Fraud Strike Force. Other attorneys prosecute matters on a case-by-case basis. Both arrangements offer excellent litigation training for OIG attorneys and enhance collaboration between the departments in their efforts to fight fraud. Under this program, OIG attorneys have successfully litigated important criminal cases relating to the fraudulent billing of medical equipment and supplies, infusion therapy, and physical therapy, as well as other types of Medicare and Medicaid fraud.

In its report, the OIG cited as an example of how this program works in a Medicare fraud case in Texas where cross-designated Special Assistant U.S. Attorney prosecuted an individual for fraud. The individual owned and operated group homes in the Houston, Texas area and engaged in a scheme to defraud Medicare by receiving kickbacks in exchange for referring her group home residents for home health services. She pleaded guilty to making false statements to federal agents and was sentenced to 6 months in prison.

 

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.

Connect with Richard Kusserow on Google+ or LinkedIn.

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Copyright © 2018 Strategic Management Services, LLC. Published with permission.

Kusserow on Compliance: OIG testifies on investigative results over last three years

Gary Cantrell, HHS OIG Deputy Inspector General for Investigations, testified before a Senate Special Committee hearing to highlight the results of the OIG’s enforcement activities, focusing many of his comments on the current Opiod Crisis. He noted that the OIG Special Agents have full law enforcement powers and collaborate with other federal, state, and local law enforcement partners to combine resources to detect and prevent health care fraud, waste, and abuse. Over the last three years, OIG investigations have resulted in more than $10.8 billion in investigative receivables; 2,650 criminal actions; 2,211 civil actions; and 10,991 program exclusions.

The OIG is a lead participant in the Medicare Fraud Strike Force, which combines the resources of the OIG and DOJ, including Main Justice, U.S. Attorneys’ Offices, and the Federal Bureau of Investigation (FBI), as well as State and local law enforcement, to fight health care fraud in geographic hot spots. Since its inception in March 2007, the Strike Force has charged more than 3,000 defendants who collectively billed the Medicare program more than $10.8 billion. Last year, the Strike Force led the largest takedown ever in health care fraud enforcement. It resulted in 412 charged defendants across 41 federal districts, including 115 doctors, nurses, and other licensed medical professionals, for their alleged participation in health care fraud schemes involving approximately $1.3 billion in false billings.

The OIG also collaborates with state Medicaid Fraud Control Units (MFCUs) to detect and investigate fraud, waste, and abuse in state Medicaid programs.  Another investigative partner is the Healthcare Fraud Prevention Partnership and the National Healthcare Anti-Fraud Association—a public–private partnership that addresses health care fraud by sharing data and information for the purposes of detecting and combating fraud and abuse in health care programs.

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.

Connect with Richard Kusserow on Google+ or LinkedIn.

Subscribe to the Kusserow on Compliance Newsletter

Copyright © 2017 Strategic Management Services, LLC. Published with permission.

Kusserow on Compliance: OIG cases involving sanctioned parties and tips to avoid violations

Compliance Officers must screen employees against the List of Excluded Individuals and Entities (LEIE). This is stressed in all of the OIG’s compliance guidance documents. CMS makes it a condition of participation and enrollment. The LEIE continues to change and grow with more than 3,000 exclusions added annually. Failure to screen employees, medical staff, contractors, and vendors results in a great risk. The OIG may consider claims that include work or products from a sanctioned party to be false and fraudulent. Violations can result in monetary penalties. Most cases that deal with this issue are brought to the OIG’s attention through the “Self-Disclosure Protocol.”  In all the recent cases posted, the OIG imposed penalties, but the penalties were mitigated by the fact the matters were self-disclosed—as a result, none of these cases resulted in a Corporate Integrity Agreement (CIA). The OIG posts a number of these cases on its website. The following are examples of recent actions against organizations that engaged individuals they knew or should have known were excluded from participation in the federal health care programs:

  • Southwest Trinity Management, LLC (STM), in Oklahoma paid $141,986.36 in settlement for employing an excluded licensed practical nurse that provided items or services that were billed to Federal health care programs.
  • Diamonds & Pearls Health Services, LLC (DPHS), Cleveland, Ohio paid $75,471.92 for employing an excluded individual who was a scheduling/staffing coordinator, provided items or services to DPHS patients that were billed to Federal health care programs.
  • Center for Ear, Nose Throat & Allergy, P.C. (CENTA) in Indiana, paid $51,564.14 for employing an excluded medical records file clerk, provided items or services to CENTA’s patients that were billed to Federal health care programs.
  • MHMR, Fort Worth, Texas, paid $97,869.78 for employing a program director who had been excluded to provide items or services to clients who were receiving services funded by a Medicaid waiver program.
  • Shawnee Health Services (Shawnee), Carterville, Illinois, paid $107,761.08 as result of employing an excluded individual as a case manager, provided items or services to clients that were receiving services under a Medicaid waiver program.
  • Arkansas Department of Health (ADH) paid $39,343.61 as result of employing an excluded hospice social worker that provided items or services to patients of a community based hospice operated by ADH.
  • Century Pharmacy (Century), Brooklyn, New York, paid $10,000 for an employed excluded individual, who assisted in filling prescriptions in addition to performing other clerical tasks, provided items or services to Century patients that were billed to Federal health care programs.
  • Sundance Behavioral Healthcare System (Sundance), Texas, paid $49,183.48 for an employed sanctioned licensed vocational nurse that provided items or services to patients that were billed to Federal health care programs.
  • ASAP Professional Home Health (ASAP), Houston, Texas, paid $21,797.76 for an employed excluded attendant, provided items or services to ASAP patients that were billed to Federal health care programs.

Practical Screening Tips

  1. Ensure periodic sanction screening of employees, medical staff, contractors, and vendors against the LEIE—best practice is monthly screening.
  2. Inasmuch as most states have developed their own exclusion database, with many states mandating monthly screenings, care should be taken to understand and meet state screening requirements.
  3. Inasmuch as most LEIE exclusions arise from another underlying court, state agency, or licensure board action, it is advisable to also conduct background checks and seek written assurances in applications that prospective employees, contractors, and vendors have not been subject to any prior court or licensure board actions.
  4. It is common for individuals that may be the subject of an investigation, but not yet sanctioned with final actions, to be under investigation for considerable time, therefore it is a best practice to require as a condition of employment, gaining staff privileges, or engagement for the applicant to attest that they have not been, nor are they now, the subject of an investigation by any duly authorized regulatory or enforcement agency. It is also advisable to add a condition that they must promptly report any notice of investigation that involves them.
  5. Educate and inform management and employees on their obligation to promptly report any notification of an adverse action by any duly authorized regulatory or enforcement agency.

Daniel Peake of the Compliance Resource Center (CRC) works with many organizations in ensuring proper sanction screening and from that experience offers a number of practical tips to avoid creating an actionable violation.  He can be reached at dpeake@strategicm.com or (703) 236-9850.

 

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.

Connect with Richard Kusserow on Google+ or LinkedIn.

Subscribe to the Kusserow on Compliance Newsletter

Copyright © 2017 Strategic Management Services, LLC. Published with permission.